Standard&Poor's Ratings Services applies a top-down rating approach to Kazakhstan Electricity Grid Operating Co. (JSC) (KEGOC), Kazakhstan's state-owned transmission grid operator, notching down two notches below the local currency rating on the Republic of Kazakhstan (foreign currency BBB-/Negative/A-3, local currency BBB/Negative/A-3; Kazakhstan national scale 'kzAAA'). This reflects KEGOC's strategically important status to the Kazakh government as a provider of core infrastructure services. We estimate KEGOC's stand-alone credit quality at 'B+'. KEGOC's stand-alone credit quality is constrained by the company's aggressive financial policy, large grid investment program and associated construction risk, high foreign currency and floating interest risk exposure, and Kazakhstan's relatively weak power sector characteristics. Kazakhstan's relatively low wealth, limited customer diversification, and historically delayed payments impair KEGOC's
