The rating on Kazakhstan Electricity Grid Operating Co. (JSC) (KEGOC) reflects its aggressive financial policy, stemming from an ambitious grid renovation and development program; the company's high exposure to foreign currency and floating interest risk; the operational challenges arising from the implementation of its North-South construction project; and the relatively weak characteristics of the national power sector. These risks are offset by KEGOC's strategic importance to the Republic of Kazakhstan (foreign currency BBB/Stable/A-3; local currency BBB+/Stable/A-2; Kazakhstan national scale 'kzAAA'), strong explicit support, and relatively supportive tariff regulation. The rating is further supported by KEGOC's continued monopoly position in a relatively stable electricity transmission business, and the good medium-term prospects for national power consumption growth. KEGOC is strategically important to
