Power sector losses drag state-owned entities' profits

Dawn reported that the combined profitability of Pakistan's state-owned entities (SOEs) fell 30 per cent in the first half of FY26, as performance weakened across seven core areas. The Ministry of Finance's July-December 2025 SOEs Monitoring Report, released on Monday, names the power sector as the weakest performer. The report estimates that loss-making SOEs lose about Rs2.8 billion a day, while fiscal support has reached nearly Rs6.6 billion daily.

Power sector circular debt rose by Rs374 billion, which the ministry linked to inefficiencies and weak recoveries. According to the report, this amount equals roughly 11 per cent of federal budgetary receipts for the six-month period, and the ministry warned it limits development spending. Total SOE debt exposures are above Rs10 trillion, including about Rs2.5 trillion in foreign currency liabilities.

Net adjusted profit came to Rs80.5 billion for the first half, down from Rs114.3 billion a year earlier, while total equity fell 3 per cent to Rs6.407 trillion. The report also flagged heavy reliance on the Oil & Gas and financial sectors for earnings, which exposes SOEs to commodity prices and exchange rate swings.