Pakistan’s SOEs slip further into loss

February 15, 2026 (MLN): Pakistan’s federal state-owned enterprises (SOEs) posted a net loss of Rs122.9 billion in FY2025, marking a sharp deterioration from the Rs30.6 billion loss recorded a year earlier, according to the government’s latest aggregate performance report.

The decline came even as cumulative losses narrowed slightly by 2% to Rs832.8 billion, suggesting that falling profits among major public corporations, rather than worsening losses, drove the overall downturn.

Aggregate profits dropped 13% to Rs709.9 billion, primarily due to reduced earnings from oil-sector entities amid softer international crude prices.

The data indicated that Pakistan’s heavy reliance on a handful of profitable SOEs to offset chronic losses across the broader portfolio.

On the balance-sheet front, total equity rose 7% to Rs6.25 trillion, largely due to government recapitalization efforts, particularly in the power sector, to address circular debt.

Total liabilities declined modestly by 3% to Rs31.74 trillion, while assets remained broadly stable at nearly Rs38 trillion.

Despite signs of stabilization in some areas, the report highlights structural weaknesses in operating performance, asset utilization, and revenue generation capacity across much of the SOE sector.

Oil & Gas giants carry the burden as infrastructure and power sectors haemorrhage cash

The financial performance of Pakistan’s SOE sector remains highly polarized, with a handful of blue-chip energy firms masking deep systemic losses in other sectors.

According to the FY2025 report, the top five profit-making entities, led by Oil and Gas Development Company Limited (OGDCL) at Rs169.9 billion and Pakistan Petroleum Limited (PPL) at Rs89.9 billion, account for nearly 90% of all SOE profits.

In sharp contrast, the National Highway Authority (NHA) emerged as the single largest loss-maker, reporting a deficit of Rs294.9 billion.

The power sector continues to be a primary source of fiscal "leakage," with regional distribution companies like Quetta Electric (QESCO) and Peshawar Electric (PESCO) incurring combined losses of over Rs205 billion.

The Performance Snapshot (FY2025):

The report concluded that while Oil & Gas and Financial SOEs show "bankability," sectors like power and manufacturing are operating with "outdated business models" that fail to cover their cost of capital, necessitating urgent structural reforms.

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