Fitch affirms Lakdhanavi at ‘AA-(lka)’; Outlook Stable

Fitch Ratings recently affirmed Lakdhanavi Limited’s National Long-Term Rating at ‘AA-(lka)’. The Outlook 
is Stable. 

Fitch rates Lakdhanavi on the consolidated profile of its parent, LTL Holdings (Private) Limited (LTLH), based on its Parent and Subsidiary Linkage Rating Criteria. 

The affirmation reflects Fitch’s expectations that Lakdhanavi’s financial profile will remain within rating sensitivities in the financial years end-March 2023 (FY23) to FY26, except in FY24 when leverage spikes temporarily on large 
debt-funded investment. 

Lakdhanavi’s rating is constrained at the current level by its large counterparty exposure to Ceylon Electricity Board (CEB, AA-(lka)/Stable). 

Fitch expects potential payment delays from CEB to ease gradually, with payments from CEB normalising following a consumer tariff hike in August 2022.  Lakdhanavi’s rating also reflects its leading market position in the operation and maintenance (O&M) segment in the country’s power sector and stable cash flow generation from fixed long-term power generation contracts in Bangladesh.