VIS Reaffirms ‘AAA’ (Triple A) and ‘A-1+’ (A-One Plus) Ratings of Pakistan Telecommunication Company Limited

VIS Credit Rating Company Limited (VIS) has reaffirmed entity ratings of Pakistan Telecommunication Company Limited (PTCL) at ‘AAA’ (Triple-A) and short term rating of ‘A-1+’ (A-One Plus). The previous rating action was announced on October 11, 2018. The ratings reflect PTCL’s leading market position, extensive network infrastructure, strong financial risk profile, and adequate business risk profile.

The long-term rating of ‘AAA’ denotes the highest credit quality, with negligible risk factors, being only slightly more than for risk-free debt of the Government of Pakistan. The short-term rating of ‘A-1+’ denotes the highest certainty of timely payment, liquidity factors are outstanding and safety is just below risk-free short-term obligations of Government of Pakistan. Outlook on the assigned ratings is ‘Stable’.

PTCL is the leading Integrated Information Communication Technology (ICT) Company in Pakistan, having the largest fixed-line network in the country. The company’s products and services include voice services, high-speed broadband internet, CharJi wireless internet, Smart TV (IPTV) service, Smart TV App and Touch App, digital-content streaming services like icflix, and enterprise-grade platforms like Smart Cloud, Tier-3 Certified Data Centers, Managed and Satellite Services.

The ratings draw comfort from PTCL’s leading market position in a fixed-line voice segment with a 90% share, wireline broadband segment with 80% share, and wireless data segment with a 30% share. The ratings also factor low financial risk profile of the company, as reflecting in healthy cash flows generation and debt-free balance sheet despite significant capital expenditure over the past three years to improve service quality and strengthen its network infrastructure through the network transformation project (NTP).