Skip to main content

HUBC: All set to get even brighter

Pakistan’s largest Independent Power Producer (IPP), the Hub Power Company Limited (HUBC) has shown a remarkable performance during 1HFY20 by doubling its profits.

The aggressive revamping of its base business as well as growth plan over the past few years has marked a turning point for HUBC’s profitability. Additionally, zero payout spell for six consecutive quarters due to liquidity crunch is likely to end in FY21, as dividend inflows from associated companies and partial resolution of circular debt on the back of issuance of Rs 200 billion Energy Sukuk II which ECC has approved on 22 January’20, would allow the company to pay dividends, thereby, revitalizing investors’ interest in the company, a report by AKD Research said.

The report further highlighted that HUBC has achieved 95% of its equity investment requirements through a mix of right issue, leverage and internal cash generation and approximately Rs 7-8 billion investment remain to be undertaken for 2x330MW projects which will be catered through further leverage and delaying payouts.

This indicates that FY20 to remain another year for without dividends from the power giant, moreover, the portion of capacity payments from the outstanding of Rs 34 billion cleared in upcoming settlement will be a better indicator of HUBC’s payout capacity in FY21, the report underscored.

Going forward, the company’s profitability is expected to rise further as contribution from 1320MW imported coal fired power plant would result in higher earnings. In 1QFY20, the plant commenced its operations and contributed Rs 4.82 billion to the 1HFY20 EPS.

Another report from Ismail Iqbal Securities indicates that the company is all set to shine even brighter as HUBC has secured its cash flows till 2051 by investing into Thar Energy Limited (TEL) and Thal Nova Power Thar Limited TNPTL
Labels:

Comments

Post a Comment

Popular posts from this blog

State Bank of Pakistan issued new instructions over the Interest Rates and Deposit Rates

Post a Comment
Read more

Engro employees who were earlier in contact with the victim test negative for Covid-19

Engro Corporation Limited in its latest Press Release has informed that the employees who were in contact with their colleague affected by the COVID-19 ، undertook the lab test and tested negative for the virus. “On Tuesday (March 11), a few Engro employees who were in contact with their colleague affected by the Coronavirus COVID-19 – undertook the lab test. Results show that all of them have tested negative for the COVID-19 and they have been given a clear bill of health by doctors” the press release said. “The Engro employee who earlier tested positive for the virus is doing well at a local medical facility. The Engro team has been in close touch with the doctors and his family and is extending all possible support” it added. As communicated earlier, Engro offices at The Harbour Front Building shall resume on Monday, March 16, 2020. Employees will continue to work from home till then. In the interim, all Engro floors at the building will be deep cleaned and disinfected.  A...
Post a Comment
Read more

Govt to provide Rs 400m subsidy to farmers on PB Rope import

The government will provide 400 million rupees subsidy to framers on the import of PB Rope from the current cotton sowing season. According to Cotton Commissioner in the Ministry of National Food Security and Research Dr Khalid Abdullah، subsidy for PB Rope imports for about 2,00,000 hectares would be provided to help overcome threats of pest attacks on crop during its fruiting season and save the crop from damage. He said the amount is being allocated to enhance per-acre cotton output across the crop sowing areas of the country. Cotton Commissioner informed that government in close coordination with private sector had also designed a holistic program to ensure provision of certified cotton seed to farmers in order to achieve maximum per acre crop output during the season and get more profit.
Post a Comment
Read more