PACRA Maintains the Entity Ratings of K-Electric Limited

K-Electric Limited (“KE” or “the Company”) is Pakistan’s sole vertically integrated power utility, responsible for ensuring reliable electricity supply across its licensed areas, including Karachi, surrounding regions of Sindh, and parts of Balochistan. From a governance perspective, FY2026 marked a significant transition year for the Company, characterized by the completion of a comprehensive Board reconstitution following a prolonged period of transition since October 2022. The process was concluded in January 2026, enabling the election of 13 directors at an Extraordinary General Meeting held on April 2, 2026. Thereafter, the newly constituted Board, in its meeting on April 15, 2026, appointed Shaheryar Arshad Chishty as Chairman. In parallel, leadership continuity was strengthened with the appointment of Syed Muhammad Taha as permanent Chief Executive Officer effective the same date, succeeding Syed Moonis Abdullah Alvi, while interim arrangements were maintained by Adeeb Ahmed to ensure operational and financial continuity during the transition. From a regulatory perspective, KE’s Multi-Year Tariff (MYT) framework for FY2024–FY2030 has undergone key revisions during 2025. NEPRA initially approved the Generation tariff in October 2024, followed by approvals for Transmission, Distribution, and Supply segments in May 2025, resulting in an average allowed tariff of approximately PKR 39.97/kWh, which was subsequently revised downward to around PKR 32.37/kWh, materially affecting the Company’s projected revenue trajectory and return profile for the remainder of the control period. The Company is in ongoing discussions with the relevant authorities, seeking resolution on tariff adequacy, recovery of prudently incurred costs, and alignment with operational realities. In the absence of a finalized tariff framework, KE’s financial reporting timelines have been impacted, with the most recent audited financial statements remaining those for the year ended June 30, 2023. Regulatory authorities have directed the Company to publish its FY24 and FY25 financial statements by June 30, 2026; accordingly, resolution is expected in the near term to facilitate timely financial reporting. From a liquidity standpoint, the debt portfolio remains well diversified, supported by a broad lender base and the Master Collection Account (MCA) mechanism, which continues to strengthen debt servicing through ring-fenced operational collections. Alongside sufficient working capital lines and stable operating cash flows, the Company’s liquidity profile is expected to remain adequate to support near-term obligations.
The recently reconstituted Board and the appointment of a permanent Managing Director/CEO in FY2026 mark an important governance transition. A key consideration for KE’s credit profile remains the timely finalization of the revised MYT tariff framework, alongside the publication of audited financial statements for post-FY23 periods. The MCA mechanism continues to support debt servicing through ring-fenced collections, while KE’s ratings remain dependent on sustained reductions in transmission and distribution losses, improvement in recovery ratios, improved operational performance, prudent financial management, and resolution of key regulatory matters.

About the Entity
K-Electric Limited (KE or the Company), originally incorporated as Karachi Electric Supply Company Limited (KESC) in 1913 is a publicly listed entity with its shares traded on the Pakistan Stock Exchange (PSX), KE is the only vertically integrated power utility in Pakistan. The majority shares (66.4%) of the Company are owned by KES Power, the Government of Pakistan is also a shareholder (24.36%) in the Company while the remaining are listed as free float shares.