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KTGA is Kazakhstan's state-owned near-monopoly engaged in domestic natural gas transportation and distribution. Its ratings are aligned with that of its immediate parent, KazTransGas JSC (KTG, BB /Stable) and reflect the company's dominant position and strong strategic and operational ties with KTG, Kazakhstan's national gas operator. KTGA is an essential part of KTG's strategy, and has a socially important function of providing natural gas to domestic consumers. Its overall strategy is approved by its ultimate parent, JSC National Company KazMunayGas (BBB/Stable). KTGA is presently expanding and upgrading the domestic gas network. We also factor in KTGA's increasing leverage and customer payment risks, as well as a developing regulatory framework, in its ratings.
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