PACRA Maintain Entity Ratings to Prism Energy (Pvt.) Limited

Prism Energy (Private) Limited (“PEPL”) commenced its solar renewable energy operations in Pakistan in August 2020. The Company operates under three business models: Power Purchase Agreement (PPA), Buyout (BOOT), and Solar on Cash (EPC). Under the PPA model, PEPL invests in solar equipment and sells electricity to customers at an agreed tariff under a long-term contract. In the BOOT model, the Company installs and operates the solar facility, with customers making monthly payments that cover the plant’s cost along with operations and maintenance. Under the EPC model, customers directly finance the installation of solar plants through PEPL on a turnkey basis. As of FY25, Prism Energy (Private) Limited has successfully installed over 12.88 MW of solar capacity across seventeen sites, including multiple projects for Dawn Foods. The Company also entered into a Power Purchase Agreement with a multilateral organization for the installation of a 185kW solar system at its Islamabad offices, which was commissioned in October 2024. During FY25, PEPL recorded a significant revenue increase of approx. 58%, reaching PKR 128mln. However, the Company reported a loss of around PKR 25mln, compared to a profit of PKR 25 million in the previous year. The loss primarily stems from a one-time adjustment related to the revised valuation of previously procured solar panels, whose prices declined substantially over the past three years. Excluding this one-off impact, PEPL’s profit for FY25 would have been around PKR 55mln, nearly double the prior year’s earnings. The Company’s equity base stood at PKR 1,235mln, with no outstanding borrowings. PEPL continues to fund its expansion through internally generated cash flows, reflecting a strong financial profile. The implementation of IFRS 16, which requires recognition of leased assets and related liabilities, has been factored into the Company’s financial reporting; however, this accounting adjustment does not materially affect its financial health or outlook.
The Ratings draw comfort from the solid and consistent cash flows of PPEL. The ratings incorporate sponsors’ confidence about the soundness of investment strategy in Alternative and Renewable Energy (ARE), as it is completely aligned with the government’s policy to promote renewables in Pakistan. However, the ratings remain dependent on the management's ability to sustain a low-risk profile along with timely receipts from customers. At the same time, maintaining a strong financial profile and liquidity remains critical. Any significant decrease in margins and/or coverages will impact the ratings.

About the Entity
Prism Energy (Private) Limited (“PEPL”) was incorporated in 2019 to invest, develop, and operate solar power projects in C&I sector in Pakistan. PEPL leverages its expertise in the solar sector to offer a range of turnkey solutions tailored to meet customer needs. PEPL Board includes five members. Mr. Arooj Asghar is the CEO of the Company, who is supported by a team of qualified professionals.