PACRA affirms Rating of Pakistan Mobile Communications Limited | Sukuk PKR 5bn | TBI

Pakistan Mobile Communications Limited (PMCL) is the leading telecommunications operator in Pakistan, holding approximately ~37% market share and serving over 74mln subscribers as of December 2025. The Company has established itself at the forefront of 3G and 4G service delivery, consistently driving innovation and shaping the evolution of the national telecommunications sector. In addition to its core connectivity services, PMCL has strategically diversified into Digital Financial Services through JazzCash and Mobilink Microfinance Bank, thereby contributing significantly to the advancement of financial inclusion across Pakistan. This expansion reflects the Company’s commitment to enabling broader access to digital and financial ecosystems. Furthermore, PMCL is actively strengthening its presence in high-growth domains, including data analytics, cloud computing, fintech, and mobile entertainment. These initiatives reinforce its transformation from a traditional telecom operator into a comprehensive digital solutions provider, positioning the Company as a key enabler of Pakistan’s digital economy. As per, Pakistan Telecommunication Authority, the industry generated revenues of over PKR 1 trillion, marking a ~12% year-on-year increase, with fiscal contributions to the national exchequer climbing to PKR 402bn in 2025, up from PKR 336bn in 2024. Investments in the sector grew by ~9%, reaching USD 838mln, driven by infrastructure expansion and rising demand for data services. During IHCY25, PMCL’s revenue surged by ~12% to PKR ~156,238mln on YOY basis (CY24: PKR~281,214mln), driven by higher ARPU and rapid growth in digital services like fintech. Company reported a net loss of PKR ~26bn during IHCY25 (CY24: profit of PKR~43bln), the primary factor for the loss in IHCY25 was the significant tax liability incurred on capital gains arising from the tower sale transaction in review period. On January 2026, PMCL has successfully executed a PKR 75bn interest rate swap with United Bank Limited, the largest such transaction in Pakistan, to strengthen financial risk management and ensure cash-flow stability. The Company's financial risk profile remains adequate, with comfortable coverages, cashflows, and working capital cycle. Capital structure is leveraged, and borrowings are mainly comprised of long-term borrowings. In IHCY25, the leveraging increased to ~73% (CY24: 69%) primarily due to license fee payments and capital expenditure requirements.
The ratings are dependent upon the sustenance of a leading market position, robust revenue growth and profitability, and a sound financial matrix. As capital structure becomes leveraged, maintenance of sound financial discipline is imperative to hold.

About the Entity
Pakistan Mobile Communications Limited – brand name ‘Jazz’ commenced its operations in August 1994. The Company is a subsidiary of International Wireless Communications Pakistan Limited, which holds ~85% of the issued share capital in the Company. VEON Pakistan Holdings B.V holds ~15% of the issued share capital in the Company. The ultimate parent Company is VEON Ltd. VEON provides essential communications and digital services to ~160mln customers in Six of the world’s most dynamic countries.

About the Instrument
PMCL is set to issue the Rated, Secured, Medium Term and Main Board Listed Sukuk. The issue amount for Sukuk, is up to PKR 5,000mln (Exclusive of PKR 3,000mln). The funds will be utilized for meeting the working capital requirement. The tenor shall be of ~5 years from the issue date, with a grace period of ~1 year. Principal is to be redeemed on semi-annually basis. Profit payment would be made on semi-annual basis, though, profit rate is yet to be decided.