Nishat Power Limited has reported a significant increase in revenue for the first quarter of the financial year 2027, supported by a substantial improvement in electricity generation and plant utilization. However, the company’s net profit declined compared with the corresponding period last year due to lower other income and higher financial costs.
According to the company’s unaudited quarterly financial statements for the quarter ended September 30, 2026, revenue increased to Rs. 8.246 billion, compared with Rs. 1.672 billion in the same quarter of the previous financial year, representing an impressive growth of 393%.
The improvement was primarily driven by higher electricity dispatch. Nishat Power’s 200-megawatt power plant, located at Jamber Kalan, District Kasur, achieved an average capacity factor of 35.28%, compared with 7.38% in the corresponding quarter last year. Electricity dispatched to the power purchaser also increased significantly to 152 GWh from 32 GWh.
Gross Profit Improves Despite Higher Operating Costs
The company’s cost of sales increased to Rs. 7.730 billion during the quarter, compared with Rs. 1.282 billion a year earlier. The increase was mainly associated with higher electricity generation and corresponding fuel consumption.
Despite higher costs, Nishat Power recorded a gross profit of Rs. 515.64 million, compared with Rs. 390.58 million in the same period last year.
Other income, however, declined to Rs. 113.42 million from Rs. 435.90 million. The reduction was primarily linked to the utilization of surplus funds for long-term investments in Rafhan Maize Products Company Limited and Nexgen Auto (Private) Limited.
Strategic Investments Begin Contributing to Earnings
Nishat Power’s investment diversification strategy has started generating returns. During the quarter, Nexgen Auto (Private) Limited contributed Rs. 210.49 million as its share of profit, reflecting Nishat Power’s 33.33% shareholding in the associated company.
Additionally, the company received a dividend of Rs. 79.59 million from its investment in Rafhan Maize Products Company Limited.
These investments represent the company’s efforts to diversify its income sources and reduce dependence on its core power generation business.
Net Profit Declines to Rs. 541 Million
Despite the strong increase in revenue and electricity generation, Nishat Power reported a net profit after taxation of Rs. 541.38 million for the first quarter of FY2027, compared with Rs. 584.30 million in the corresponding period last year.
Earnings per share also declined to Rs. 1.53 from Rs. 1.65.
The decline in profitability was mainly attributable to lower other income, partially offset by the contribution from the associated company.
The company also recorded an other comprehensive loss of Rs. 732.44 million, primarily due to a fair value adjustment on its investment measured at fair value through other comprehensive income. Consequently, total comprehensive loss for the quarter stood at Rs. 191.06 million.
Rising Receivables Remain a Major Concern
One of the key challenges highlighted in the quarterly report is the increase in outstanding receivables from the power purchaser, Central Power Purchasing Agency (Guarantee) Limited.
Receivables increased to Rs. 9.607 billion as of September 30, 2026, compared with Rs. 6.541 billion at the end of June 2026.
The company attributed the increase to continuing circular debt pressures in Pakistan’s power sector. Delayed payments have affected liquidity and increased reliance on short-term borrowings to meet working capital requirements.
Short-term borrowings increased to Rs. 5.908 billion from Rs. 4.909 billion at the end of the previous financial year.
The company stated that management is actively pursuing recoveries and remains engaged with the power purchaser and relevant authorities to ensure timely realization of outstanding amounts.
Outlook: Higher Capacity Utilization and Investment Diversification
Looking ahead, Nishat Power expects capacity utilization to remain elevated in the near term. The company linked this expectation to continuing geopolitical tensions in the Middle East and resulting constraints on re-gasified liquefied natural gas (RLNG) supplies for gas-based power plants. However, electricity dispatch may continue to fluctuate.
The company is also exploring additional investment opportunities. Its board has approved participation in a consortium led by Pakgen Limited for the proposed privatization of Faisalabad Electric Supply Company (FESCO). The participation remains subject to necessary corporate and regulatory approvals, and the company has stated that no binding obligation had been assumed as of the report date.
Conclusion
Nishat Power’s first-quarter FY2027 results reflect a strong recovery in electricity generation and a substantial increase in revenue. Its growing investment portfolio is also beginning to contribute to earnings through profit from Nexgen Auto and dividend income from Rafhan Maize Products.
Nevertheless, lower net profit, rising receivables, circular debt pressures and increased short-term borrowings remain important challenges.
The company’s future financial performance will depend on maintaining electricity generation levels, improving cash recoveries from the power purchaser and successfully expanding its investment portfolio.
