PV Power receives “BB” rating for third consecutive year

Tuesday, May 30, 2023 16:44

Workers at Nhon Trach 2 Plant. — VNA/VNS Photo Huy Hung

Fitch Ratings has affirmed PetroVietnam Power Corporation (PV Power)’s long-term foreign-currency issuer default rating (IDR) at “BB” with a positive outlook.

This is the third consecutive year that PV Power has received “BB” rating with a positive outlook, the highest rating that a Vietnamese company can reach.

The rating, which is based on PV Power's Standalone Credit Profile (SCP) assessment of “BB”, is on a par with the IDR of its 80 per cent parent, Vietnam Oil and Gas Group (PVN, BB/Positive).

PV Power's SCP is driven by its strong market position as Viet Nam's second-largest electricity producer, accounting for around 5 per cent of the country's total electricity output and 5 per cent of installed capacity in 2022. It also benefits from diversified fuel sources, long-term power-purchase agreements (PPAs) with Viet Nam Electricity (EVN, BB/Positive) for more than 80 per cent of its electricity output and a strong financial profile.

However, EVN's IDR constrains PV Power's SCP, even though PV Power's financial profile is stronger than its SCP assessment indicates. The positive outlook is driven by the positive outlook on EVN's IDR.

The rating is expected to help the firm attract more attention from international credit institutions. Currently, PV Power is investing in many projects with large capital needs such as Nhon Trach 3 & 4 Power Plants and a power project using imported liquefied natural gas (LNG) in Quang Ninh.

As of the end of the first quarter this year, PV Power’s total electricity production had surpassed 4 billion kWh, exceeding its plan by 16 per cent, with a revenue of VND7.91 trillion (US$337.04 million), 20 per cent higher than its quarterly plan, up 10 per cent year on year. — VNS

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