Engro Holdings Limited (ENGROH) reported earnings per share of PKR 47.21 for CY25, compared to earnings per share of PKR 26.78 in CY24. Furthermore, in 1QCY26, the company reported earnings per share of PKR 8.50, compared to earnings per share of PKR 1.66 in the same period last year (SPLY). Regarding EPCL management commented that the business posted losses in 2025 amid record low global PVC margins and elevated power costs.
Management remains focused on reducing dependence on costly captive gas and is actively evaluating grid based and alternative power solutions to improve cost competitiveness. The tower portfolio currently carries approximately PKR 40 billion in outstanding debt, of which nearly 40% is hedged, providing partial protection against financing cost and currency related volatility. The management terminated the agreement to divest its thermal power assets after the 12 month long stop date lapsed without reaching a mutually agreed valuation.
Management noted that these assets are currently performing above expectations and continue to generate healthy dividend flows. Management indicated that the estimated GIDC liability stands at approximately PKR 20 bn for Engro Fertilizers Limited and PKR 4 5 billion for Engro Holdings. While the matter remains under litigation, management believes the balance sheet remains sufficiently strong to absorb these payments, particularly if the government allows settlement through installments.
Management confirmed that it is evaluating an acquisition offer from Lotte Chemical Pakistan Limited for Engro Polymer & Chemicals Limite. The decision to divest or retain the asset will be driven by capital allocation priorities, based on the value creation potential versus the offered valuation and alternative redeployment opportunities for the proceeds. Capacity payments for the tower infrastructure business are structured under individual contracts, with a significant portion indexed either to the US Dollar or local CPI, providing a natural hedge against inflation and currency depreciation.
Important Disclosures
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