PACRA maintains Entity Ratings of Halmore Power Generation Company Limited

Halmore Power Generation Company Limited ((“HPGCL” or “the Company”) is an independent power producer (IPP), operating a Combined Cycle gas turbine plant on a build-own operate (BOO), having gross capacity of 225MW located at Bhikki Sheikhupura. The plant achieved its commercial operations in June 2011 with its PPA valid till Feb 2042. Mr. Karim Ud Din is the major sponsor of the company. The Company has an O&M with General Electric and fuel supply agreements with SNGPL and PSO. The ratings of Halmore take comfort from the Power Purchase Agreement signed between the Power Purchaser and HPGCL, which ensures capacity payments as well as guaranteed electricity offtake—given adherence to agreed parameters. Further, a cushion is drawn from low operational risk, a result of the established performance credentials of GE the O&M operator. The required availability for Halmore Power under the PPA is 88%. During the period, average plant availability remained in accordance with the agreed parameter. The plant generated 207 GWh of net electrical output for the year ended June 2024. The fall in generation represents lower demand from NTDC as a result of the government's increasing preference for more cost-effective power generation options. Net income recorded during FY24 was PKR 3,139mln (FY23: PKR 3,277mln, FY22: PKR 1,060mln, FY21: PKR 4,215mln). The company successfully paid off its long-term project-related debt in June 2021, resulting in a favorable impact on its financial risk profile. At the end of June 2024, the debt profile comprises short-term borrowings only, which have been availed to meet working capital requirements, mainly due to delayed payments from the off-taker. The company has an equity base of PKR 24,042 million, whereas leveraging stands at 28.1% at the end of FY24. Negotiations are currently underway between the government and Independent Power Producers (IPPs) regarding the implementation of a Hybrid Take-and-Pay model.
Upholding operational performance in line with agreed performance levels would remain a key rating driver. If there are any development regarding negotiation with task force ,that may impact the company rating, as the outcome of the negotiations may influence its financial performance.

About the Entity
Halmore Power Generation Company Limited (“HPGCL” or “the Company”), an Independent Power Producer (IPP) with a gross capacity of 225 MW, operating under the 2002 power policy, is a combined gas cycle turbine plant with gas as primary and HSD as secondary fuel. Mian Karim ud Din owns 99.99% of the shares of the company. The four-member Board of Directors (BoD), including one executive director, is representative of the sponsoring family. The Chief Executive Officer (CEO), Mr. Mahmood Akhbar, brings over fifteen years of experience in the construction, operation, and maintenance of power generation and transmission systems.