PACRA Maintains the Entity Ratings of K-Electric Limited

K-Electric Limited (“KE” or “the Company”) is a strategic national asset and only vertically integrated power utility of the Country, dedicated to ensure power supply across its licensed areas, which include Karachi, surrounding regions of Sindh, and parts of Balochistan. KE remains focused on long-term transformation and growth and is demonstrated by its approved Power Acquisition Programme (PAP) for FY24 to FY28, which outlines a strategic plan to expand capacity to meet rising energy demand. Currently, the Company’s own generation capacity stands at 2,397 MW, supplemented by 1,600 MW received from the national grid. KE’s distribution network spans approximately 6,500 square kilometers, serving a customer base of around 3.7 million. Under a rehabilitation plan for the transmission and distribution segments investment plan of USD 2 billion from FY24 to FY30 has been approved. The plan aims to grow the customer base and substantially reduce power outages. The generation segment constitutes the major share of revenue at approx. 50%, followed closely by the distribution segment, which contributes around 46%. KE’s tariff expired in FY23. To ensure a more structured approach, KE submitted separate tariff petitions for Generation, Transmission, Distribution, and Supply segments in December 2023. NEPRA has since approved the Investment Plan and tariffs for all segments—Generation in October 2024, and Transmission, Distribution, and Supply in May 2025, a significant development that bodes well for the Company’s long-term profitability and sustainability. With these approvals in place, KE is expected to publish its post-FY23 financial statements within the next quarter. In the absence of audited financial statements for the period post-FY23, the KE’s credit profile was assessed using managements financials, projection, alongside the actual operational performance and current outstanding financial obligations. The analysis and cash flow position provides confidence in the Company’s ability to service its debt on time. Further assurance is derived from the allocation of funds into Master Collection Accounts (MCAs), which are specifically earmarked for the repayment of long-term debt, ensuring timely fulfillment of financial commitments. Debt levels are projected to rise to fund improvements in the transmission and distribution network. Operationally, KE has reduced T&D losses and continues efforts to improve efficiency. Beyond its core operations, KE is diversifying through its wholly owned subsidiary, K-Solar, which offers EPC services for solar installations nationwide, supporting regional expansion. The current project pipeline remains strong and is expected to positively impact KE’s future earnings.
The Rating Watch reflects the delay in finalizing KE’s financial statements for the period post-FY23, primarily due to the absence of an approved tariff. Timely completion of these statements, along with the impact of recently approved tariffs on KE’s financial and operational profile, remain key factors. The rating also considers the government’s shareholding, alongside significant investments from Saudi Arabia and Kuwait. Ongoing discussions among the shareholders of KES Power, the majority stakeholder in KE, are seen as important for maintaining corporate stability. Nevertheless, KE’s operations continue without disruption, with management operating independently and effectively.

About the Entity
KE is primarily owned by KES Power Limited, which holds a 66.4% majority stake and comprises a consortium of Al-Jomaih Group (Saudi Arabia), KE Holdings Limited, and Denham Investments. The Government of Pakistan holds a 24.4% stake, while the remaining shares are publicly traded as free float. The Company is led by CEO Mr. Moonis Alvi, who has been associated with KE since 2008, along with a skilled and experienced management team.