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Reuters
a day ago
- Business
- Reuters
Pakistan draws five potential buyers for national airline PIA, including military-backed group
ISLAMABAD, June 19 (Reuters) - In its efforts to sell its struggling national airline, Pakistan has received expressions of interest from five parties, including business groups and a military-backed firm, the Privatisation Ministry said on Thursday. The bids were submitted ahead of a June 19 deadline to acquire up to 100% of Pakistan International Airlines ( opens new tab, which has accumulated over $2.5 billion in losses in roughly a decade. Still, following a major restructuring, it posted its first operating profit in 21 years in the year through June 2024. The sale is seen as a test of Pakistan's ability to shed loss-making state firms and meet conditions of a $7 billion International Monetary Fund bailout. It would be the country's first major privatisation in nearly two decades. Eight parties submitted their expression of interests, but only five of them provided documents of qualification, the ministry said in a statement. Among the five groups is a consortium of major industrial firms: Lucky Cement Ltd ( opens new tab, Hub Power Holdings Ltd ( opens new tab, Kohat Cement Co Ltd ( opens new tab and Metro Ventures. Another is led by investment firm Arif Habib Corp Ltd ( opens new tab, and includes fertiliser producer Fatima Fertilizer Co Ltd ( opens new tab, private education operator The City School, and real estate firm Lake City Holdings. Fauji Fertilizer Company Ltd , a military-backed conglomerate, Pakistani airline Airblue Ltd and a consortium that includes Bahria Foundation, domestic carrier Serene Air and U.S.-based Equitas Capital LLC also submitted documents. "The government will review the documents and give qualified parties access to data for due diligence," the statement read. Once a leading global airline, PIA resumed European flights in January after a four-year EU ban linked to safety concerns, and is seeking UK clearances, seen as key to its turnaround. Industry insiders say the winning bidder is expected to partner with a foreign airline to run operations. A previous attempt to sell the airline failed as a $36 million bid from real estate firm Blue World City fell short of the $305 million floor price, with concerns over debt, staffing, and limited control. This time, the government is offering full divestment, has scrapped the sales tax on leased aircraft, and is providing limited protection from legal and tax claims. Around 80% of the airline's debt has been transferred to the state. "We're targeting 86 billion rupees in privatisation proceeds this year," Privatisation Minister Muhammad Ali told Reuters. "For PIA, in the last round of bidding, 15% of the proceeds were going to the government, with the rest staying within the company." He said bidders would be pre-qualified in early July, with due diligence lasting 2 to 2.5 months, and final bidding and negotiations expected in the fourth quarter of 2025. Officials hope the sale will revive the stalled privatisation drive. Other planned deals include the Roosevelt Hotel and several power firms, by mid-2026. "From the Roosevelt Hotel, we're expecting over $100 million as first payment during this year," said Ali.
Arab News
a day ago
- Business
- Arab News
Five groups submit qualification documents in Pakistan's renewed push to privatize PIA
KARACHI: Pakistan has received qualification documents from five investor groups seeking to acquire a controlling stake in its loss-making national carrier, the Privatization Commission said on Thursday, as the government advances a long-delayed divestment plan. The privatization of state-owned entities has been mandated by the International Monetary Fund (IMF) as Pakistan works to implement structural reforms and stabilize its economy, which has recently shown signs of macroeconomic improvement. Pakistan International Airlines (PIA), in particular, has survived for years on government bailouts, placing further strain on the country's already cash-strapped finances. The government invited expressions of interest in April for a stake ranging from 51 percent to 100 percent in Pakistan International Airlines Corporation Limited (PIACL), along with management control. The final deadline for submitting Statements of Qualification (SOQs) was today. 'The Privatization Commission received Expression of Interest (EOI) from ... eight interested parties,' the official statement said, adding that 'five interested parties submitted SOQs by the deadline today.' Among the groups that submitted documents are a consortium comprising Lucky Cement, Hub Power Holdings, Kohat Cement, and Metro Ventures; a consortium led by Arif Habib Corporation with Fatima Fertilizer, City Schools and Lake City Holdings; Air Blue Limited; Fauji Fertilizer Company Limited, which is a military-backed firm; and a consortium including Serene Air, Augment Securities, Bahria Foundation, Mega C&S Holding and Equitas. The government had previously attempted to privatize PIA in 2024 but called off the process after receiving a single bid of Rs10 billion ($36 million) from Blue World City — far below the Rs85 billion ($305 million) floor price. The sale was scrapped, citing the airline's weak financial position and unattractive terms for buyers. PIA has long been a fiscal liability, with operational earnings repeatedly offset by heavy debt servicing. However, following restructuring, it reported an operating profit of Rs9.3 billion ($33.1 million) in April, its first in 21 years. 'The SOQs submitted by the parties will be evaluated by the Privatization Commission against the prequalification criteria,' the official statement informed. 'The prequalified parties will proceed to the next stage where they will be given access to the virtual data room to undertake buy-side due diligence.'
Express Tribune
7 days ago
- Business
- Express Tribune
PSX tumbles on heightened Mideast tensions
Listen to article The Pakistan Stock Exchange (PSX) witnessed a significant downturn on Friday as the KSE-100 index plunged nearly 2,000 points over rising geopolitical tensions following Israeli military strikes on Iran. The broad-based sell-off reflected heightened investor anxiety as fears of regional escalation dampened sentiment across global and local markets. Heavyweight sectors such as fertiliser, cement, banking and technology suffered steep losses with blue chips bearing the brunt. Market participants shifted to a risk-off mode, offloading positions in response to the global uncertainty and Pakistani rupee weakness. Arif Habib Corp MD Ahsan Mehanti observed that stocks fell across the board after Israeli strikes on Iran and as investors eyed an escalation in the conflict. Additionally, a slump in global equities on geopolitical risks and the weakening rupee also contributed to panic selling, he said. At the end of trading, the benchmark KSE-100 index recorded a substantial fall of 1,949.56 points, or 1.57%, and settled at 122,143.57. Topline Securities wrote in its review that stocks largely traded in the negative zone, which was in line with international and regional trends, following Israel's attack on Iran. Top negative contribution to the index came from fertiliser, cement, bank and oil stocks. In terms of traded value, DG Khan Cement ($6.4 million), Maple Leaf Cement ($5.92 million), Lucky Cement ($4 million), OGDC ($3.72 million), Pakistan State Oil ($3.65 million) and Mari Petroleum ($3.15 million) dominated trading activity, Topline said. KTrade Securities stated that the KSE-100 index ended the session in the negative territory, pressured by escalating geopolitical tensions in the region, particularly between Iran and Israel. Despite that, market activity remained robust, with trading volumes exceeding 966 million shares. Sideboard stocks were the most actively traded, which included Pervez Ahmed Consultancy (116 million shares), WorldCall Telecom (100 million) and First Capital Securities (85 million). Notable declines were recorded in Engro Corporation, Lucky Cement, Fauji Fertiliser, Bank AL Habib and Systems Limited. In light of prevailing regional uncertainties, KTrade advised investors to maintain a cautious approach in the near term. Arif Habib Limited (AHL) Deputy Head of Trading Ali Najib mentioned that the market witnessed a sharp correction as it reacted to heightened geopolitical tensions following Israeli strikes on military and nuclear facilities inside Iran. The benchmark index opened in the red and quickly extended losses, hitting the intra-day low of 121,605 points, down 2,489 points, amid broad-based selling pressure. Heavyweight blue-chip stocks in fertiliser, cement, banking and technology sectors bore the brunt of the sell-off, Najib added. According to JS Global analyst Mubashir Anis Naviwala, the market opened on a negative note in line with regional equities and it experienced a highly volatile session. Sentiment received a blow from escalating tensions between Iran and Israel, fuelling investor caution. The index touched the low of 121,605 and closed at 122,144, down 1,950 points. Volatility persisted throughout the day amid uncertain global cues. He advised investors to adopt a cautious stance and avoid aggressive positions in the near term with focus on risk management and tracking geopolitical developments. Overall trading volumes decreased to 968.3 million shares compared with Thursday's tally of 1.02 billion. The value of shares traded was Rs29.6 billion. Shares of 469 companies were traded. Of these, 130 stocks closed higher, 304 fell and 35 remained unchanged. Pervez Ahmed Consultancy was the volume leader with trading in 116.7 million shares, rising Rs1 to close at Rs2.93. It was followed by WorldCall Telecom with 100.9 million shares, gaining Rs0.08 to close at Rs1.45 and First Capital Securities with 85.3 million shares, higher by Rs0.94 to close at Rs3.06. Foreign investors bought shares worth Rs179 million, the National Clearing Company reported.
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Business Standard
02-06-2025
- Business
- Business Standard
China powers Pakistan's green energy ambitions amid IMF's loan conditions
Bootstrapped Pakistan has been slapped with 11 new conditions by the International Monetary Fund (IMF) for the release of its next tranche of bailout programme. One of the conditions ties Pakistan's access to the Resilience and Sustainability Facility (RSF) to its efforts to tackle climate change and promote clean energy for long-term economic stability. And Pakistan looks no further than its 'iron brother' China to meet this need. Lucky Cement, one of Pakistan's largest cement manufacturers, now has Chinese wind turbines and solar panels supplying over half of its energy needs at its Karachi plant. This shift has significantly reduced the company's carbon footprint, cutting carbon dioxide emissions by 60,000 tonnes annually, the Financial Times reported on Monday. Chinese solar panel prices have dropped sharply in recent years, while electricity costs from Pakistan's grid have risen. In response, Islamabad imported solar panels with a total capacity of around 19GW last year, the Financial Times quoted Jenny Chase, lead solar analyst at BloombergNEF, as saying. She estimates Pakistan is still importing panels capable of generating 1GW to 3GW each month this year—enough to power a city of millions. China's role in Pakistan's energy transition At the heart of this renewable energy transition is China, which has been Pakistan's largest investor in the energy sector. Since 2005, China has invested over $68 billion in Pakistan, with energy projects accounting for 74 per cent of that total. The China-Pakistan Economic Corridor (CPEC), launched in 2015 as part of Beijing's Belt and Road Initiative, has been the driving force behind this investment, particularly during its first phase, which focused on coal-based power generation. Of the 13 GW of power added to Pakistan's grid, 8 GW came from coal, while renewable sources like solar and wind contributed just 1.4 GW. But now both countries are looking to up the investment in green energy projects. Notable among the projects under the CPEC framework include the Quaid-e-Azam Solar Park in Pakistan's Punjab region. Wind projects in Sindh and hydro plants in the north further diversify the energy mix, supporting the goal of 30 per cent renewables by 2030. Demand for Chinese batteries While a shift to Chinese wind turbines and solar panels has helped companies like Lucky Cement to reduce its carbon footprint, it still relies on fossil fuel generators to ensure a stable energy supply. To address this gap, Lucky Cement is investing 1.5 billion Pakistani rupees ($5.3 million) in Pakistan's largest battery energy storage system (BESS), supplied by China's Contemporary Amperex Technology Co Ltd (CATL). The 20.7 MW system will store renewable energy for use during off-peak hours or in case of grid instability, and it will be capable of powering 20,000 homes for one hour when fully operational. As the prices of wind, solar, and battery technologies continue to fall, Lucky Cement expects a faster return on its investment, allowing the company to further increase its use of clean energy. Karachi-based Diwan International has reported a 33 per cent drop in the price of 5 kWh BYD batteries, making them more accessible to wealthier households, mosques, and businesses. The challenges However, the widespread adoption of renewable energy in Pakistan is not without its challenges. While solar power is becoming more affordable, battery storage remains costly, limiting its reach to lower-income households. The Pakistani government has taken steps to address these issues, including slashing industrial tariffs and offering surplus grid power to sectors such as crypto mining and AI data centres. Despite these measures, the divide between wealthier users shifting to solar and poorer households struggling with rising bills continues to widen. Moreover, attracting clean energy investment in Pakistan has become more difficult. Since the pandemic, only $4.86 billion of Chinese energy capital has flowed into Pakistan, much of it directed towards a single nuclear project in Chashma. Lucky Cement's shift to renewable energy supports the IMF's push for cleaner, more sustainable energy. This move also benefits Chinese companies, as they play a key role in supplying the solar, wind, and battery technologies driving Pakistan's green energy future.
Express Tribune
28-04-2025
- Business
- Express Tribune
PSX slides 1,405 points amid Pak-India tensions
The Pakistan Stock Exchange (PSX) witnessed a tug-of-war between the bulls and bears on Monday, as the index swung between a high of 116,659 (+1,190 points) before sweeping downwards to a low of 113,868 (-1,601 points). The KSE-100 index ultimately closed at 114,063.90, a decline of 1,405.45 points, or 1.22%. Analysts noted that the geo-political tensions following India's suspension of the Indus Water Treaty, as well as stalled bilateral trade and escalating tensions between the two countries played a catalyst role in the bearish close. According to Ahsan Mehanti of Arif Habib Corp, stocks fell across the board as investors eyed heightened geopolitical tensions following India's suspension of the Indus Water Treaty and stalled bilateral trade. He added that concerns over deteriorating Pak-India trade ties, and cross-border tensions played a catalyst role in the bearish close at PSX. At the close of trading, the benchmark KSE-100 index recorded a decrease of 1,405.45 points, or 1.22%, and settled at 114,063.90. In its market review, Topline Securities stated that today's trading session witnessed "a classic tug-of-war between bulls and bears." The index opened on a positive note, gaining strong momentum in the early hours, to register an intraday high of 1,189 points. However, the optimism proved short-lived, as intensified selling pressure later in the session caused the index to reverse sharply, touching an intraday low of 1,601 points, noted the brokerage. It added that the prevailing negative sentiment was largely driven by escalating tensions between India and Pakistan, which heightened investor concerns and weighed heavily on overall market confidence. On the positive side, Systems Limited, Lucky Cement, Meezan Bank, and HBL collectively contributed 489 points to the index. Conversely, the bulk of the negative impact came from Engro Holdings, UBL, Mari Petroleum, Engro Fertiliser, and PSO, which together shaved off 907 points from the benchmark, Topline stated. Despite the risk-averse sentiment, overall market participation remained firm, with volumes clocking in at 421 million shares and a turnover of Rs26.43 billion, it mentioned. Arif Habib Limited (AHL) in its commentary said that the week started off poorly due to tensions between India and Pakistan, impacting sentiment to hit the weekly downside objective of 113,700 points on Monday. Some 25 shares rose while 73 fell, with Engro Holdings (-6.21%), UBL (-3.32%) and Mari Petroleum (-2.45%) contributing the most to index declines. On the flip side, Systems Limited (+7.39%), Lucky Cement (+2.45%) and Meezan Bank (+2.08%) were the biggest upside contributors, observed AHL. It added that Indus Motor Company Limited announced 9MFY25 earnings per share (EPS) of Rs210.62, representing a 76% year-on-year (YoY) increase, and DPS of Rs126.0 per share, beating expectations. Additionally, Lucky Cement reported 9MFY25 EPS of Rs18.67, a 46% YoY increase, coming above expectations as well. Fauji Fertiliser Company reported 1QFY25 EPS of Rs12.39, a 25% YoY increase, and DPS of Rs7.0, also surpassing expectations, noted AHL. It concluded that the market can see a bounce once 113,700 points are taken out, but the bias remains to the downside against the "Indus Water Treaty Gap." Ali Najib from Insight Securities remarked in his review that "markets thrive amidst positive vibes, not in warmongering!" Indeed, one can expect a short-lived rally but sustainable positive momentum is unlikely till the recent escalation between India and Pakistan gets settled. That's the tale of today's trading session, he asserted. Overall trading volumes decreased to 423.9 million shares compared with Friday's tally of 471.1 million. Shares of 449 companies were traded. Of these, 93 stocks closed higher, 313 fell and 43 remained unchanged. Bank of Punjab was the volume leader with trading in 23.7 million shares, falling Rs0.41 to close at Rs9.3. It was followed by Power Cement with trading in 21.6 million shares, falling Rs0.99 to close at Rs13.29 and WorldCall Telecom with 18.3 million shares, falling Rs0.03 to close at Rs1.26. During the day, foreign investors bought shares worth 209.2 million, the National Clearing Company of Pakistan Limited (NCCPL) reported.
