PACRA Maintains the Entity Ratings of Master Wind Energy Limited

Master Wind Energy Limited (MWEL) operates a 52.8MW wind power project in the Jhimpir Wind Corridor, Sindh, marking the Master Group’s first venture into the energy sector. The ratings are underpinned by a regulated framework that ensures revenue certainty through guaranteed returns, cost indexation, and a pass-through tariff mechanism. Under this regime, if MWEL maintains contractual availability and is ready to supply power, the power purchaser is obligated to pay the full tariff even in the case of curtailed dispatches. Receivables are further secured by the Government of Pakistan’s sovereign guarantee on CPPA-G’s obligations. The Company remains exposed to two principal risks. The first is wind risk, as fluctuations in wind speeds directly affect generation and cash flows. In the past, disturbances in wind patterns have led to lower generation compared to benchmarks; nonetheless, the plant has remained profitable, meeting its financial obligations in a timely manner. Improved wind conditions are expected to normalize generation patterns going forward. The second risk relates to operations, mitigated by the engagement of General Electric International Inc. as the O&M operator, leveraging its international expertise and local market experience. In FY25, MWEL generated 95.376 GWh of electricity compared to 127.366 GWh in FY24, reflecting a decline of 25% year-on-year. Consequently, revenue contracted to PKR 4,189mln (FY24: PKR 6,115mln). The contraction stemmed from normalization of inflation and exchange rate stability, which reduced indexation adjustments, along with softer demand, lower NPMV, and delayed interest payments. Despite this, the Company continues to meet its working capital requirements through internally generated cash flows and has not availed external working capital lines. Its liquidity profile remains adequate, as evidenced by the repayment of ~80% of project debt without utilizing the forbearance period, reflecting sound financial discipline and cash flow management.
The ratings remain dependent on the Company’s ability to maintain operational performance in line with contractual benchmarks, sustain prudent financial metrics, and ensure timely debt repayments. External factors, including ongoing power sector reforms, potential regulatory changes, and any deterioration in the financial risk profile, also remain key considerations, the outcomes of which are yet to unfold.

About the Entity
Master Group, with a legacy of over 50 years, diversified from its flagship foam business into multiple sectors including textiles, engineering, automobiles, and retail. Master Wind Energy Limited (MWEL), incorporated in 2005, operates a 52.8MW wind farm in Jhimpir, Sindh. The project cost amounted to USD 132.3mln, of which 75% (USD 99.2mln) was financed equally by local and foreign lenders. To date, around 80% of the project debt has been repaid. Its Board comprises eight members, with majority representation from the Master Group, and is led by Mr. Shahzad Malik, Managing Director since 2011, supported by an experienced management team.