The Pakistan Credit Rating Agency Limited
Press Release


Faizan Arif

Applicable Criteria

Related Research

This press release is being transmitted for the sole purpose of dissemination through print/electronic media. The press release may be used in full or in part without changing the meaning or context thereof with due credit to PACRA

Hub Power Company Limited redeems Privately Placed Commercial Paper of PKR 3.5bln | April-19 fully redeemed; rating withdrawn

Issuer The Hub Power Company Limited
Instrument PPCP
Amount PKR 3500 mln
Issuance Date 23-Apr-19
Tenor 0.4 Years
Redemption Date 24-Jul-19
Outstanding Amount -

Rating Type Debt Instrument
Action Redeem Preliminary
Long Term - AA+
Short Term - A1+
Outlook - Stable
Rating Watch - -

Hubco issued unsecured, privately placed commercial paper of PKR 3,500mln to bridge the gap of proceeds from right issue, due in July 2019. The Commercial Paper had a tenor of ninety days, carried a profit rate of 3MK + 100bps. The redemption was in bullet at the time of maturity from the proceeds of right shares. The instrument was due for the final redemption in Jul-19, has been fully redeemed.
Subsequent to the completion of the redemption process, the Pakistan Credit Rating Agency (PACRA) has withdrawn the rating of Hub Power Company Ltd | Privately Placed Commercial Paper of PKR 3.5bln | April-19.

About the Entity
Hubco, a listed company, was incorporated in 1991. During the year, Dawood group, largest shareholder along with its associates sold its stake to Mega Conglomerate (Pvt.) Ltd, making Mega Conglomerate single largest shareholder (~19%). Mega Conglomerate (Pvt.) Ltd (19.4 %) is the single largest shareholder, followed by ABL (9.7%), Fauji Foundation (8.5%) and NBP (5%). Hubco holds 100% stake in Narowal Energy Ltd which operates a 225MW capacity oil-fired power plant at Narowal and 75% controlling interest in Laraib Energy Ltd that operates 84 MW hydel power plant. The BoD comprises eleven-members including the CEO of Hubco. BoD includes three representatives from Mega Conglomerate. Mr. Khalid Mansoor, the CEO, carries over three decades of experience in Energy & Petrochemical sectors in leading roles. He is supported by a team of experienced professionals.

The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.