PACRA Upgrades Entity Ratings of Nayatel (Private) Limited

Nayatel Private Limited’s (The Company) ratings reflect a strong business profile and sturdy presence in the telecommunication industry of Pakistan. The company specializes in triple-play services offering telephony, cable TV, and data through its advanced networks. The company excels by providing ultra-broadband, high-definition cable TV, and allied services through scalable, cutting-edge technologies. The company’s core revenue is originating from the flagship product i.e., FTTH (Fiber to the Home), and over the period established a strong presence and captured a significant market share. As a part of diversification strategy, the company has expanded into the FTTT (Fiber to the Tower) segment, achieved significant milestones and established itself as a market leader.The stability of Nayatel hinges on its strong business model, robust technology infrastructure, unwavering commitments to customers service, and continuous innovation in service offerings, which ensure consistent, reliability and customer retention in technology driven environment. The ratings take comfort from various strategic initiatives taken by the management with a vision to achieve sustainable growth in the longer horizon. The latest data from the PTA, reveals that Nayatel ranks third in the FTTH segment, holding a significant share of active subscribers. This achievement underscores the company strong position in a rapidly growing market. Currently, Nayatel operates in 15 cities across Pakistan, leading the market in Islamabad and Rawalpindi, with ongoing expansion into new areas within these cities. Following Islamabad and Rawalpindi, Faisalabad, Peshawar, and Gujranwala are key revenue contributors. The company has also expanded its operations to Sargodha, Sialkot, Sheikhupura, Bahawalpur, Sahiwal, Lahore, Multan, Gujrat, Muzaffargarh, and Rajanpur. During CY23, the company’s topline clocked in at PKR 7,835mln (CY22: ~PKR 6,459mln), reflecting a growth of 21.3% primarily driven by acquisition of new customers & increase in ARPU. The varied customer base, which includes both corporate and home clients, enhances the company's strategic position in pricing, profit margins, and capacity utilization. Stiff competition exists in the FTTH market segment where strength is primarily derived from owned and self-laid length of fiber optic cable networks. The company has instigated a sound internal control system across the organization which is accompanied by IT, business insight & intelligence, and financial reporting solutions. The governance of the company is considered good while the addition of an independent oversight can further strengthen it. The company has a skilled management team. The top executives are closely connective hence team cohesiveness is an advantage. The overall pool of management reflects quality human resources and performance-driven culture. The financial risk profile is considered good with comfortable cashflows, coverages, and working capital management. Capital structure is leveraged, encompassed by long-term borrowings for CAPEX and expansion.
The ratings are dependent on the Company’s ability to maintain its leadership position within its business niches in a dynamic market environment. Achieving consistent revenue growth, improving margins, and delivering on prudent financial management, as outlined in company projections, will remain critical. However, adherence to maintaining its debt matrices at an adequate level is a prerequisite.

About the Entity
Nayatel (Private) Limited, established in 2004, owned by Micronet broadband (Pvt.) Limited (MBL).Mr. Wahaj us Siraj, is the CEO of Nayatel possessing an experience of over two decades in the broadband industry. The other 2 founders i) Mr. Aqeel Khurshid and ii) Mr. Saad Saleem holds the position of CTO and COO, respectively.