PACRA Assigns Initial Entity Ratings to Lumen Energia (Pvt.) Limited

Lumen Energia (Pvt.) Ltd. (“Lumen” or “the Company”) operates in the energy sector with a focus on sustainable steam production through the combustion of biomass—primarily sourced from agricultural waste. This strategic positioning not only aligns with global sustainability goals but also capitalizes on the abundant availability of biomass in Pakistan’s agrarian landscape. The assigned rating is further supported by Lumen’s affiliation with its sister concerns, Axis Environment Services and Scandic Green Energy (Pvt.) Ltd. in partnership with its German collaborator UPM, has been operating in Pakistan since 2006, focusing on the development of CDM and renewable energy projects. Scandic specializes in biomass supply and established Pakistan’s first biomass briquetting plant in Badin with an annual capacity of 10,000 metric tons. It has also expanded into steam generation, serving clients such as Engro Friesland in Sahiwal. Collectively, these affiliations enhance Lumen’s technical depth, resource access, and operational credibility, thereby strengthening its capacity to deliver efficient, environmentally responsible energy solutions to the industrial sector in Pakistan.
Lumen Energia (Pvt.) Ltd. is strategically focused on expanding its presence in the provision of environmentally sustainable energy solutions to Pakistan’s manufacturing sector through the phased development of biomass-based plants. This approach reinforces the Company’s commitment to environmental stewardship and positions it as a significant contributor to corporate social responsibility (CSR) initiatives. The Company has established its first biomass-based steam generation facility in Kabirwala, Punjab, with an annual production capacity of 100,000 metric tons. Pursuant to a 10-year long-term offtake agreement, Nestlé Pakistan is contracted to procure 90,000 metric tons of steam annually from this plant. The project entailed a total capital outlay of PKR 500mln. In line with its expansion strategy, the Company is in the process of developing a second, identical facility in Sahiwal for Engro Friesland with same production capacity, also with a capital cost of PKR 500mln. Both projects are being financed through a capital structure comprising 75% debt and 25% equity. To support the debt component, the Company secured a 10-year long-term financing facility of PKR 1bln from Bank Alfalah. The Company benefits from the leadership of owners possessing extensive experience and a demonstrated track record of successful business ventures. Lumen maintains a good governance framework, underpinned by rigorous internal controls and an experienced management team. Sponsors' acumen is reflected in the development of corporate culture through enhanced business practices.
The assigned ratings remain contingent upon Lumen's ability to sustain margin resilience, strengthen liquidity buffers, and preserve capital discipline amid scale-up. Its forward-looking investment in the formalization of the agri-biomass vertical, coupled with continuous innovation and operating efficiency gains, will be pivotal in supporting the current credit profile.

About the Entity
Lumen Energia (Pvt.) Limited, incorporated in 2010, is an unlisted private company headquartered in Islamabad, focusing on biomass-based energy solutions. The Company operates a steam production plant in Kabirwala using agricultural waste to generate industrial steam. Lumen has signed long-term steam purchase agreements with Nestlé Pakistan and is developing a second plant with Friesland Campina Engro Pakistan. The Company plays a pioneering role in sustainable energy, aiming to reduce carbon footprints through innovative biomass utilization. The Company’s major ownership resides with partners Mr. Arif Alam (49%), Ahmad Naveed Ismail (51%). Mr. Arif Alam, with his sound entrepreneurial skills, serves as the Chief Executive Officer. A team of experienced professionals assist him.