Lahore, October 09, 2023 (PPI-OT): Lucky Electric Power Company Limited (“LEPCL” or “the Company”) has set up a 1x660MW (gross) coal-fired power plant. The project achieved COD in March-22 and is successfully connected to and providing electricity to the grid. The primary fuel is Coal; a coal supply agreement is signed with Sindh Engro Coal Mining Company (SECMC), SECMC will provide the coal from its developing Block-II (Phase III), which will be started in May-24. The previous tentative month was May-23. The Company has also signed imported coal supply agreement with reputable coal suppliers.
Currently, plant is generating electricity through the mix of local and imported coal. The Company has generated a topline of ~PKR 98.3bln during FY23. Lucky Electric Power Company Limited generated a bottom line of ~PKR 9.4bln during the same period. Comfort is drawn from the experience of O and M contractor. O and M Contractor, KEPCO Plant Services and Engineering Co. Ltd – Republic of Korea (KPS) has been replaced with M/s Harbin Electric International Co., Ltd. -P.R. China (HEI).
Going forward, the Company’s main focus would be to keep the plant operational. The Company has currently procured short-term financing facilities aggregating to ~PKR 18,249mln which are ~70% utilized as of June 2023. Additionally, the Company has outstanding debt instruments amounting to PKR 29bln for operational needs. PPSTS-14 will be issued in rollover of PPSTS-9 which is due to mature on 12th October, 2023. The cumulative short-term borrowings stand at ~PKR 39,689mln as of June 2023.
The financial strength and experience in the energy chain of the sponsoring company Lucky Cement – are considered positive for the ratings. However, considering the unusual increase in working capital requirement due to the significant devaluation of PKR, supply chain issues and tariff adjustments, LEPCL is striving to manage its need. The offtake agreement is with CPPA-G, which will, upon the plant’s availability as per the contract, provide capacity payments even if no purchase order is placed. The Government of Pakistan has given a payment guarantee against dues from CPPA-G.
For more information, contact:
Analyst,
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore, Pakistan
Tel: +92-42-5869504-6
Fax: +92-42-5830425
Email: hammad.rashid@pacra.com
Website: www.pacra.com
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