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Express Tribune
12-07-2025
- Business
- Express Tribune
PSX extends record rally on investor interest
Listen to article The benchmark KSE-100 index at the Pakistan Stock Exchange (PSX) closed the week at a new record high on Friday to settle at 134,300 points as bullish sentiment prevailed amid robust corporate results and continued institutional inflows. Investor activity was particularly fueled by strong earnings of UBL, which posted a 99% year-on-year (YoY) surge in 1HCY25 earnings per share to Rs26.07 and declared a higher-than-expected dividend of Rs19 per share. Market breadth remained positive, with 55 stocks advancing and 45 declining. UBL (+2.4%), Hubco (+1.6%) and Millat Tractors (+2.76%) were the top contributors to the day's gains, collectively lifting the index by over 300 points. Meanwhile, pressure in select banking names such as Bank AL Habib (-3.3%), MCB Bank (-1.04%) and HBL (-1.22%) limited the upside. At close, the benchmark KSE-100 index posted a gain of 517.42 points, or 0.39%, and settled at 134,299.77. Trading activity remained strong, with volumes reaching 765 million shares and a traded value of Rs40 billion. Analysts at Topline Securities attributed the day's momentum to rising mutual fund allocations to equities, shifting away from fixed income, as shown in the National Clearing Company data. With macroeconomic indicators improving and remittances hitting a record $38.3 billion, sentiment continued to remain bullish, setting the stage for a potential test of 136,000 in the sessions ahead. Traded value-wise, UBL (Rs2.32 billion), DG Khan Cement (Rs1.64 billion), Attock Refinery (Rs1.61 billion), Hubco (Rs1.44 billion), The Bank of Punjab (Rs1.24 billion) and Maple Leaf Cement (Rs1.19 billion) dominated the trading activity, Topline said. "Stocks closed at a new all-time high in the earnings season rally as investors weighed surging forex reserves that reached $20 billion and upbeat auto sales data, which showed a 38% YoY growth for FY25," said Arif Habib Corp MD Ahsan Mehanti. The revision in development spending to Rs1.05 trillion for FY25 and record remittances played the role of catalysts for the new peak at the PSX, he added. Arif Habib Limited (AHL) wrote in its report that the KSE-100 index enjoyed another solid week, gaining 1.8% week-on-week, on the back of strong corporate earnings and investor interest. On Friday, 55 stocks advanced while 45 declined, where UBL (+2.4%), Hubco (+1.6%) and Millat Tractors (+2.76%) contributed the most to index gains. In contrast, Bank AL Habib (-3.3%), MCB Bank (-1.04%) and HBL (-1.22%) were the biggest drags. UBL announced 1HCY25 earnings per share of Rs26.07, up 99% YoY, and a dividend payout of Rs19 per share. Earnings were in line with expectations while the payout exceeded estimates. For the coming week, technical indicators suggest support at around 132,000, with a potential upside towards 136,000, AHL said. Overall trading volumes were recorded at 765.1 million shares, compared with the previous session's tally of 941.7 million. The value of shares traded during the day was Rs40.2 billion. Shares of 477 companies were traded. Of these, 220 stocks closed higher, 228 fell and 29 remained unchanged. The Bank of Punjab was the volume leader with trading in 94.1 million shares, gaining Rs0.08 to close at Rs13.08. It was followed by Aisha Steel Mills with 25.1 million shares, gaining Rs0.44 to close at Rs12.11 and Kohinoor Spinning Mills with 23.6 million shares, losing Rs0.20 to close at Rs6.69. Foreign investors sold shares worth Rs350 million, the National Clearing Company reported.
Business Recorder
01-07-2025
- Business
- Business Recorder
IPPs warn govt: Furnace oil levies could raise generation costs
ISLAMABAD: Independent Power Producers (IPPs) have warned the government that proposed levies on furnace oil could significantly raise electricity generation costs and disrupt refinery operations. In letters sent to the Petroleum Division and other stakeholders ahead of the 2025–26 federal budget, both Hub Power Company (Hubco) and the IPPs Advisory Council (IPPAC) expressed serious concerns over the planned imposition of a Carbon Levy (CL) and Petroleum Levy (PL) on furnace oil. According to the draft Finance Bill 2025–26, a PL of Rs. 77 per litre (Rs. 82,077 per metric ton) and a CL of Rs. 2.5 per litre (Rs. 2,665 per metric ton) will be enforced starting July 1, 2025. Baggasse-fired IPPs: Nepra set to approve 60% hike in FCC Hubco's Chief Financial Officer noted that this would raise furnace oil prices by Rs. 84,742 per metric ton—making it less competitive compared to other fuels used in power generation. The CFO emphasized that while cheaper sources of electricity are available, FO-based plants are still needed during summer peaks due to their quick start-up capability. He warned that the added levies would lead to higher electricity tariffs, undermining the government's recent efforts to cut costs by renegotiating Power Purchase Agreements (PPAs) with several IPPs. 'Furnace oil makes up 20–25% of local refinery output,' he said. 'If consumption drops due to higher prices, it could cause storage issues at refineries and worsen the already critical circular debt situation. Moreover, the expected revenue from these levies and related sales tax collections may not materialize.' Hubco urged the Ministry of Energy to reconsider the move, cautioning that it could intensify the energy crisis and negatively affect the economy. IPPAC echoed these concerns, saying the decision contradicts the government's stated support for domestic industry. It warned that higher FO costs would drive up industrial production expenses and reduce utilization of FO-based power plants. The council noted that recently renegotiated tariffs aimed at lowering electricity costs would be rendered ineffective by the new levies. 'These price hikes will likely push FO-based IPPs down the merit order, potentially making them inactive,' IPPAC stated. It also predicted that the levies would worsen the circular debt issue and reduce government revenues due to falling furnace oil sales and lower sales tax collection. Copyright Business Recorder, 2025
Business Recorder
01-07-2025
- Business
- Business Recorder
IPPs warn govt: FO levies could raise generation costs
ISLAMABAD: Independent Power Producers (IPPs) have warned the government that proposed levies on furnace oil could significantly raise electricity generation costs and disrupt refinery operations. In letters sent to the Petroleum Division and other stakeholders ahead of the 2025–26 federal budget, both Hub Power Company (Hubco) and the IPPs Advisory Council (IPPAC) expressed serious concerns over the planned imposition of a Carbon Levy (CL) and Petroleum Levy (PL) on furnace oil. According to the draft Finance Bill 2025–26, a PL of Rs. 77 per litre (Rs. 82,077 per metric ton) and a CL of Rs. 2.5 per litre (Rs. 2,665 per metric ton) will be enforced starting July 1, 2025. Baggasse-fired IPPs: Nepra set to approve 60% hike in FCC Hubco's Chief Financial Officer noted that this would raise furnace oil prices by Rs. 84,742 per metric ton—making it less competitive compared to other fuels used in power generation. The CFO emphasized that while cheaper sources of electricity are available, FO-based plants are still needed during summer peaks due to their quick start-up capability. He warned that the added levies would lead to higher electricity tariffs, undermining the government's recent efforts to cut costs by renegotiating Power Purchase Agreements (PPAs) with several IPPs. 'Furnace oil makes up 20–25% of local refinery output,' he said. 'If consumption drops due to higher prices, it could cause storage issues at refineries and worsen the already critical circular debt situation. Moreover, the expected revenue from these levies and related sales tax collections may not materialize.' Hubco urged the Ministry of Energy to reconsider the move, cautioning that it could intensify the energy crisis and negatively affect the economy. IPPAC echoed these concerns, saying the decision contradicts the government's stated support for domestic industry. It warned that higher FO costs would drive up industrial production expenses and reduce utilization of FO-based power plants. The council noted that recently renegotiated tariffs aimed at lowering electricity costs would be rendered ineffective by the new levies. 'These price hikes will likely push FO-based IPPs down the merit order, potentially making them inactive,' IPPAC stated. It also predicted that the levies would worsen the circular debt issue and reduce government revenues due to falling furnace oil sales and lower sales tax collection. Copyright Business Recorder, 2025
Express Tribune
24-04-2025
- Business
- Express Tribune
Coal share in power sector grows
The increased use of local coal has directly lowered power generation costs. In March 2025, the average fuel cost per unit dropped to Rs12.2, down 27% from Rs16.8 a year earlier. photo: file Listen to article Pakistan's power sector is shifting as locally mined coal gains a larger share in electricity generation, easing energy costs and reducing dependence on imports. According to a recent report of Topline Securities, power generation in March 2025 reached 8,409 gigawatt-hours (GWh), marking a 5% annual increase and a 21% jump from February 2025. The standout figure, however, was the 62% year-on-year surge in electricity produced from local coal, which climbed to 1,393 GWh in March 2025 compared to 862 GWh in the same month of last year. This growth has elevated local coal's contribution to the national energy mix to 17%, up from 11% a year earlier, signalling a strategic pivot towards indigenous resources. For decades, local coal reserves in Thar, Sindh, estimated at 175 billion tons, remained untapped due to technical challenges and limited investment. However, the energy crisis of the 2010s, marked by prolonged blackouts and soaring import bills, pushed the government to rethink its strategy. By 2014, under the China-Pakistan Economic Corridor (CPEC), projects to develop Thar's coal fields and build associated power plants gained momentum. The coal-fired plants operational since 2019 have generated over 27,000 GWh of electricity at a fuel cost of just Rs4.8 per unit, a fraction of the Rs19.5 per unit cost for imported coal. This shift has saved Pakistan approximately $1.3 billion in foreign exchange, according to the Sindh government. Meanwhile, the Sahiwal Coal Power Plant, located in Punjab and commissioned in 2017, was one of CPEC's early ventures, which initially relied on imported coal but has gradually incorporated Thar coal into its operations. Power sector stakeholders said that Thar's development faced hurdles, including scepticism about the quality of lignite coal, which has high moisture content and lower energy efficiency. However, advancements in mining technology and boiler designs tailored to Thar's coal specifications enabled breakthroughs. By 2022, the Thar coalfield began supplying coal to power plants across the country, including Port Qasim Electric and Hubco's plants, which were converted to handle local coal. The expansion of mining operations and infrastructure, such as upgraded railways for coal transport, further accelerated adoption. Environmental concerns, however, linger. Coal combustion emits greenhouse gases, and Thar's arid region faces water scarcity, raising questions about sustainable mining practices. "Thar coal is a double-edged sword, while it provides affordable energy and energy security, we are actively investing in technologies to minimise ecological impact, including plans for carbon capture and renewable energy hybrids," said a power sector official while talking to The Express Tribune. As per the report, the increased use of local coal has directly lowered power generation costs. In March 2025, the average fuel cost per unit dropped to Rs12.2, down 27% from Rs16.8 a year earlier. Monthly comparisons also showed an 11% reduction from February's Rs13.8 per unit. "These savings are critical for a country where high energy prices have troubled industries and households," said the official. Local coal has been a game changer for Pakistan's energy independence, but "we are equally committed to expanding solar, wind, and hydro projects to ensure a sustainable mix". "Coal is a bridge, not the destination, and as a country we are balancing cost-effective energy with global climate commitments by diversifying into renewables, while optimising coal use," the official added.
