{"id":9338,"date":"2025-05-23T14:24:28","date_gmt":"2025-05-23T09:24:28","guid":{"rendered":"https:\/\/ksestocks.com\/blog\/?p=9338"},"modified":"2025-05-23T14:24:30","modified_gmt":"2025-05-23T09:24:30","slug":"can-pakistans-power-sector-light-up-portfolios","status":"publish","type":"post","link":"https:\/\/ksestocks.com\/blog\/can-pakistans-power-sector-light-up-portfolios\/","title":{"rendered":"Can Pakistan\u2019s power sector light up portfolios?"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\">Key takeaways:<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>April 2025 power generation surged <strong>22% YoY<\/strong>, the highest increase since April 2022<\/li>\n\n\n\n<li>Average generation cost held flat YoY at <strong>Rs. 8.95\/kWh<\/strong>, but dropped <strong>3% MoM<\/strong><\/li>\n\n\n\n<li><strong>Hydel contribution<\/strong> rose to 22%, reducing overall cost<\/li>\n\n\n\n<li><strong>Coal and RLNG<\/strong> were the top contributors to the energy mix<\/li>\n\n\n\n<li>Furnace oil&#8217;s share dropped below 1%\u2014reflecting a structural shift away from expensive fuels<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">A powerful comeback for Pakistan\u2019s electricity output<\/h2>\n\n\n\n<p>Pakistan\u2019s power sector just posted its <strong>strongest year-on-year growth in over two years<\/strong>. As per NEPRA\u2019s data for April 2025, electricity generation clocked in at <strong>10,513 GWh<\/strong>, reflecting a <strong>22% YoY increase<\/strong>\u2014a clear sign that demand is picking up after a prolonged period of stagnation.<\/p>\n\n\n\n<p>On a <strong>month-on-month basis<\/strong>, power generation also rose by <strong>25%<\/strong>, backed by seasonal summer demand, a shift of captive power plants (CPPs) to the national grid, and a drop in consumer tariffs. These factors, along with expectations of an industrial rebound, point to a <strong>favorable outlook<\/strong> for power producers and distributors.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Generation mix: cleaner and cheaper<\/h2>\n\n\n\n<p>Hydel, coal, RLNG, and nuclear plants were the major contributors this month:<\/p>\n\n\n\n<figure class=\"wp-block-table is-style-stripes\"><table class=\"has-fixed-layout\"><thead><tr><th>Source<\/th><th>Apr-25 Share<\/th><th>YoY Change<\/th><\/tr><\/thead><tbody><tr><td>Coal<\/td><td>25%<\/td><td>+186%<\/td><\/tr><tr><td>Hydel<\/td><td>22%<\/td><td>+11%<\/td><\/tr><tr><td>RLNG<\/td><td>21%<\/td><td>Flat<\/td><\/tr><tr><td>Nuclear<\/td><td>18%<\/td><td>-8%<\/td><\/tr><tr><td>Gas<\/td><td>8%<\/td><td>-14%<\/td><\/tr><tr><td>Furnace Oil<\/td><td>1%<\/td><td>Minimal<\/td><\/tr><tr><td>Renewables (Wind\/Solar\/Bagasse)<\/td><td>~6% total<\/td><td>Mixed<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p>This diversification, particularly the <strong>rise in hydel share to 22% from 15% in March<\/strong>, helped pull down the average generation cost to <strong>Rs. 8.95\/kWh<\/strong>, a <strong>3% MoM drop<\/strong>. This cost efficiency bodes well for the financials of generation companies and should support margin expansion in upcoming quarters.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Cost breakdown by source \u2013 April 2025<\/h2>\n\n\n\n<figure class=\"wp-block-table is-style-stripes\"><table class=\"has-fixed-layout\"><thead><tr><th>Source<\/th><th>Cost (Rs\/kWh)<\/th><th>MoM Change<\/th><th>Contribution to Total Cost<\/th><\/tr><\/thead><tbody><tr><td>Hydel<\/td><td>0.00<\/td><td>0%<\/td><td>0.00<\/td><\/tr><tr><td>Coal<\/td><td>13.42<\/td><td>-3%<\/td><td>2.97<\/td><\/tr><tr><td>RLNG<\/td><td>24.26<\/td><td>+5%<\/td><td>4.49<\/td><\/tr><tr><td>Nuclear<\/td><td>2.10<\/td><td>+5%<\/td><td>0.34<\/td><\/tr><tr><td>Gas<\/td><td>11.81<\/td><td>-1%<\/td><td>0.85<\/td><\/tr><tr><td>FO<\/td><td>28.93<\/td><td>+8%<\/td><td>0.00<\/td><\/tr><tr><td><strong>Average<\/strong><\/td><td><strong>8.95<\/strong><\/td><td><strong>-3%<\/strong><\/td><td><strong>8.95<\/strong><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">What does it mean for investors?<\/h2>\n\n\n\n<p>The shift in Pakistan\u2019s energy mix toward <strong>cheaper and cleaner fuels<\/strong> like hydel and nuclear, combined with falling RLNG and gas costs, is setting the stage for <strong>improved sector profitability<\/strong>. Energy companies with a strong hydel or diversified generation portfolio stand to benefit most.<\/p>\n\n\n\n<p>The <strong>government\u2019s effective move away from furnace oil<\/strong> (now under 1% of the mix) and the stabilizing generation costs may also provide a cushion to distribution companies (DISCOs), reducing circular debt risk.<\/p>\n\n\n\n<p>With industrial demand expected to rebound and tariffs becoming more competitive, <strong>investors should keep a close eye on IPPs (Independent Power Producers)<\/strong> and other listed utilities in the coming quarters.<\/p>\n\n\n\n<p><strong>Source: JS Global <\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Pakistan\u2019s power sector just posted its strongest year-on-year growth in over two years. As per NEPRA\u2019s data for April 2025, electricity generation clocked in at 10,513 GWh, reflecting a 22% YoY increase\u2014a clear sign that demand is picking up after a prolonged period of stagnation.<\/p>\n","protected":false},"author":9252,"featured_media":9346,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[154,343],"tags":[277],"class_list":["post-9338","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","category-sector-analysis","tag-power-sector"],"featured_image_src":{"landsacpe":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2025\/05\/Top-X-Stocks10-1140x445.jpg",1140,445,true],"list":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2025\/05\/Top-X-Stocks10-463x348.jpg",463,348,true],"medium":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2025\/05\/Top-X-Stocks10-300x188.jpg",300,188,true],"full":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2025\/05\/Top-X-Stocks10.jpg",1920,1200,false]},"_links":{"self":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/9338","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/users\/9252"}],"replies":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/comments?post=9338"}],"version-history":[{"count":3,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/9338\/revisions"}],"predecessor-version":[{"id":9349,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/9338\/revisions\/9349"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media\/9346"}],"wp:attachment":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media?parent=9338"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/categories?post=9338"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/tags?post=9338"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}