Engro Holdings Limited (ENGROH) reported earnings per share of PKR 47.21 for FY25, compared to earnings per share of PKR 26.78 in FY24. Furthermore, in 2QFY26, the company reported earnings per share of PKR 11.31, compared to earnings per share of PKR 13.57 in the same period last year (SPLY). The Group recorded a total cash outflow of approximately PKR 14 billion on account of super tax liabilities.
Management indicated that efforts are underway to adjust this outflow against existing tax refunds. The tower business has now scaled into a landmark portfolio of 15,000 towers. For 2026, management estimates that this vertical will generate an incremental PKR 36 billion in revenue, compared to the seven-month contribution recorded in 2025. Current tenancy ratios stand at 1.25x (Enfrashare) and 1.3x (Deodar).
Management’s long-term strategic objective is to increase tenancy levels to 1.8–1.9 over the next five to six years, which would materially enhance returns and operating leverage. A standard 45 metre tower entails a capital cost of approximately PKR 10 million (civil and power infrastructure), with an additional PKR 2.5 million required for solarization. Within the fertilizer segment, Engro Fertilizers reported healthy sales volumes; however, profitability remained under pressure due to aggressive market discounting and an incremental PKR 2 billion impact from super tax. Regarding EPCL, management characterized 2025 as the weakest commodity cycle in a decade, with core delta at depressed levels. Encouragingly, 1Q2026 has shown a recovery, with core delta improving to the $330–340 range, which management considers sustainable and healthy for the business. The Group divested an 18% stake in EPQL as part of capital optimization efforts, while retaining management control and preserving associated tax efficiencies.
The restructuring into Engro Holdings has resulted in a leaner capital allocation platform. Importantly, the tower business is now expected to deliver PKR 8–9 billion in recurring PAT, establishing a meaningful earnings anchor for the Group’s valuation framework. On the matter of FBR notices relating to electricity income, management expressed strong confidence in its legal position,They maintain that the implementation agreements explicitly exempt electricity income (excluding interest income) from taxation.
Important Disclosures
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