ICRA Nepal has reaffirmed its credit rating for Ncell. In its recently released report, the credit rating agency gave Ncell an ICRANP LA rating for the company’s long-term loan and an ICRANP A1 rating for short-term loan limits. This rating continuation reflects the company’s healthy financial state despite its falling revenues in recent years.
The ratings have translated into the company’s total debt to OPBDITA of 0.7 times as of mid July 2025. ICRA Nepal states that Ncell maintained a sound operating profit margin of 50% in FY 2025, albeit a slight moderation from 54% in FY 2024.
ICRA has credited the company’s experienced board members and seasoned management team as the positives. It has also taken into account the telco’s operations since 2005, entry barriers for new entrants, and a saturated user base in the country.
It’s also projected that in the future, the financial aspect may take a hit amidst the growing revenue fall. In FY 023, the GSM revenue was 53%, while it fell to 51% in FY 2025.
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Ncell’s debt levels have decreased
The report mentions that Ncell has kept its high market value in the past five years. Its debt levels have decreased, too. It’s consistent with the CEO Foley stating that Ncell has an unleveraged balance sheet in the company. Likewise, the revenues from voice and international long-distance (ILD) calls have gone down. ICRA Nepal has mentioned that Ncell’s cost control strategies have “restricted higher correction in margins.” It has also held the private telco’s higher ARPU as a positive.
As per ICRA Nepal, Ncell has an on-balance sheet cash of Rs 14 billion as of mid-October 2025 and a cushion in terms of unutilized drawing power.
Ncell’s share was bought by Spectrlite UK in late 2023 after Axiata exited. But despite the departure of the multinational telco group, the board and management have remained positive about its incremental business performance.
Challenges ahead
Ncell’s voice and data market share stood at 48% in FY 2025, while data ARPU will remain similar due to increased 4G expansion. So far, the telco has extended its 4G network to over 95% of the total population. However, the company has Rs 86 billion in contingent liabilities as of mid-July 2025 in tax claims for past ownership in 2016. This could have a significant impact on the company’s finances.
The company may also need to ensure sizeable amounts of capex to upgrade its services and quality. The possibility of license expiration in 2029 might also hurt its capital plans.
ICRA Nepal’s report highlights that Ncell’s financial state remains robust at present; however, challenges remain high in the near future, given its service upgrade works, expansion projects, and license expiration possibility.
