Rating Release
Agusto & Co hereby upgrades Paras Energy and Natural Resources Development Limited’s (“Paras Energy,” “PENRDL” or “the Company”) ratings to “A+” (long term) and “A1” (short term) with a stable outlook
The ratings expire on 30 June 2026.
Agusto & Co hereby upgrades Paras Energy and Natural Resources Development Limited’s (“Paras Energy,” “PENRDL” or “the Company”) ratings to “A+” (long term) and “A1” (short term). The rating upgrade reflects the Company’s good profitability, supported by stable earnings from its take-or-pay power purchase contracts as well as its growing customer base. The rating also highlights PENRDL’s adequate working capital and low leverage. In addition, the rating considers the Company’s foreign-currency denominated earnings, which provide a natural hedge against foreign exchange risk and its ongoing investments in renewable energy to diversify income streams and expand power generating capacity. However, the rating is constrained by PENRDL’s rising receivables and related party balances which could ultimately impair cash flow and liquidity, and a corporate governance framework that requires strengthening.
Paras Energy is a licensed power generation company authorised by the Nigerian Electricity Regulatory Commission (NERC) to operate up to 170 megawatts (MW) of on-grid capacity. Incorporated in 2002, PENRDL commenced operations in 2016 with 48.7MW and now has 110MW installed capacity. The Company exports electricity to Société Béninoise de Production d’Électricité (SBPE) – the state-owned power utility company in Benin and Compagnie Énergie Électrique du Togo (CEET) – Togo’s national electricity utility company. PENRDL also supplies electricity to blue-chip companies in Nigeria such as PZ Cussons and FrieslandCampina WAMCO. Paras Energy is developing a 25MW solar power plant to diversify its energy mix. The Company is owned by Paras Energy Holding Company Pte Limited, a Singaporean investment firm with energy assets in Nigeria.