Analysis Date: March 14, 2026

Pakistan Petroleum
Limited (PPL)

Deep Dive Equity Research & Strategic Asset Evaluation — Pakistan's Pioneer in Natural Gas & Oil Exploration since 1950.

PSX: PPL Oil & Gas Exploration SOE | PSWF Majority KSE-100 Component Fiscal Year End: June
Current Price
PKR 210.62
1-Day Change
-1.92%
52-Week Range
128.56 – 284.60
Market Cap
PKR 573B
P/E Ratio (TTM)
7.06x
YTD Change
-10.58%
1-Year Return
+14.32%
Analyst Target (Avg)
PKR 317
MantrixEdge Rating
Strong Buy
Target Range: PKR 270 – 320  |  Upside: +28% to +52%  |  Horizon: 12-18 Months
Snapshot

📊 Key Financial Metrics

EPS (FY25 Annual)
PKR 33.82
vs PKR 42.01 FY24 (-19.5% YoY)
EPS H1 FY26 (Latest)
PKR 14.84
Q1: 7.38 + Q2: 7.46 (cumulative)
Book Value / Share
PKR 269.51
P/B Ratio: 0.78x — Trading Below Book
Gross Profit Margin
62.59%
World-class for E&P sector
Net Profit Margin
37.95%
FY25 — Highly sustainable
Return on Equity
13.04%
Expected FY26: 10.14%
Return on Assets
9.93%
ROCE: 18.55% — Solid
Current Ratio
4.57x
Excellent liquidity buffer
Financials

📋 Annual Income Statement (PKR '000s)

Metric FY2022 FY2023 FY2024 FY2025
Net Revenue 202,199,183 286,480,252 288,797,413 242,516,363
Profit After Tax 53,546,164 97,937,106 114,309,077 92,027,450
EPS (PKR) 19.68 35.99 42.01 33.82
EPS Growth YoY +2.13% +82.88% +16.73% -19.50%
Gross Margin 65.09% 66.86% 65.58% 62.59%
Net Margin 26.48% 34.19% 39.58% 37.95%

Source: PSX Data Portal | All figures unconsolidated

Recent Performance

📈 Quarterly Financials — FY26 in Focus (PKR '000s)

Quarter Sales PAT EPS (PKR) QoQ EPS Change
Q2 FY25 (Oct-Dec 24) 60,720,556 27,336,299 10.05
Q3 FY25 (Jan-Mar 25) 63,824,951 21,795,150 8.01 -20.3%
Q1 FY26 (Jul-Sep 25) 56,812,356 20,087,951 7.38 -7.9%
Q2 FY26 (Oct-Dec 25) 61,189,733 20,299,146 7.46 +1.1% (stabilising)

Key Observation: After a sharp decline from Q2 FY25's strong PKR 10.05 EPS, PPL's earnings have now stabilised around PKR 7.4–7.5 per quarter in H1 FY26. The QoQ uptick in Q2 FY26 signals that the bottom is likely in. Next earnings release is expected Apr 28, 2026.

Valuation

🎯 Valuation Analysis & Peer Comparison

Valuation Metrics

P/E Ratio (TTM)
7.06x
Expected P/E (FY26)
7.06x
Price / Book Value
0.78x
EV / EBITDA
4.41x
Price / Sales
2.35x
EV / Sales
2.64x

Fair Value Scenarios

DDM (6% yield assumption)PKR 270 – 290
P/E Rerating (10x × EPS 30)PKR 300
Price-to-Book (1x NAV)PKR 269
Analyst Consensus AveragePKR 317
Analyst Consensus HighPKR 421
MantrixEdge Base TargetPKR 270 – 320
PPL currently trades at a 26%+ discount to book value and at near-historic P/E lows. At 7.06x, it is significantly cheaper than OGDC (6.7x) sector peer average, and far below PSX market average of 15–20x.
Company P/E Ratio P/B Ratio Net Margin Div Yield Market Cap (PKR B)
PPL 7.06x 0.78x 37.95% ~3.6% 573
OGDC 6.7x 0.84x 42.4% 5.5% 1,120
POL ~8x ~1.2x ~35% 12%+ 187
MARI ~9x ~1.1x ~38% ~4% ~260
PSX Market Avg 15-20x 1.5x+ Variable ~4-5%
Price Targets

🔭 Price Forecast — 12 to 18 Month Outlook

Bear Case
PKR 200
Oil price crash below $65/bbl, heavy circular debt, no policy support
Base Case
PKR 270 – 295
Stable oil prices, gradual debt recovery, Reko Diq progress on track
Bull Case
PKR 320 – 360
Oil >$85/bbl, circular debt resolution, new discoveries, Reko Diq re-rating
Analyst High
PKR 421
Max estimate from 8 buy-rated analysts (Investing.com consensus)
Income

💰 Dividend Profile & History

Last Annual Dividend
PKR 7.50
FY25 — Payout Ratio: ~22%
H1 FY26 Dividend Paid
PKR 4.00
1st Interim: Rs.2 | 2nd Interim: Rs.2 (Mar 12, 2026 credit)
Dividend Yield (TTM)
3.6%
Dividend cover: 4.51x — Very safe
FY2022
PKR 4.5
FY2023
PKR 8.5
FY2024
PKR 9.0
FY2025
PKR 7.5
FY26 H1 (So Far)
PKR 4.0

Note: PPL's low payout ratio (~22%) means dividends are not a primary draw vs peers like POL. However, the payout is extremely safe (4.51x cover) with room to grow if earnings recover.

Business

🛢️ Operational Overview & Exploration Portfolio

Core Production Fields

Sui (Balochistan)Largest producing field — gas dominant
Adhi (Punjab)Multi-product: oil, gas, NGL
Kandhkot (Sindh)Gas — major operated block
Chachar (Sindh)Gas producing
Mazarani, Adam, ShadadpurMultiple southern Sindh fields
Total Producing Fields~16 Producing Fields

Exploration Portfolio

Total Exploration Assets~52 Blocks
Operated Blocks (Onshore)29+ (incl. offshore)
Partner Operated Blocks23 (incl. Yemen concession)
Abu Dhabi (UAE) — Offshore Block 5PIOL — Active Exploration
Reko Diq (Copper & Gold)PMPL — 25% indirect stake
Baragzai X-01 (Mar 2026)New HC Discovery — Nashpa Block

Strategic Highlights — 2025/26

Reko Diq Project: PPL holds an indirect 25% non-operating stake via PMPL in Reko Diq — one of the world's largest undeveloped copper-gold deposits. This is a major long-term re-rating catalyst as the mine moves towards production.
Baragzai Discovery (2026): In February and March 2026, PPL announced hydrocarbon discoveries from the Baragzai X-01 well (Slant) in both Lumshiwal Formation and Lockhart Limestone — a positive signal for reserve additions.
Abu Dhabi Offshore: PIOL (associated company) is progressing on Block 5 offshore Abu Dhabi. Finalization of development plan for the block is underway — international diversification play.
Circular Debt Recovery: Major receivables are from SSGC and SNGPL. Back-to-back consumer gas price increases have started improving collections from 2H FY25. This is the single most important near-term catalyst.
Balance Sheet

🏦 Financial Health & Balance Sheet

Liquidity & Solvency

Current Ratio4.57x
Quick Ratio4.81x
Equity to Assets76.13%
Debt to Equity31.94%
Long-Term Debt / Equity10.56%
Effective Tax Rate33.83%

Key Balance Sheet Items

Total Assets (Q3 FY25)PKR 963 Billion
Shareholders' Equity (est.)PKR 733 Billion
Book Value Per SharePKR 269.51
Cash Per SharePKR 4.79
Enterprise ValuePKR 634 Billion
EV Per SharePKR 233.16
Long-term Debt / Assets8.00% — Conservative
Interest CoverageExcellent (high EBITDA)
Insider Signal

👁️ Insider Transactions — Bullish Signal

PU
Pir Muhammad Usman
Executive — PPL
BUY 4,500 shares @ PKR 265.00 — Feb 6, 2026
PU
Pir Muhammad Usman
Executive — PPL
BUY 2,000 shares @ PKR 275.00 — Feb 2, 2026
PU
Pir Muhammad Usman
Executive — PPL
BUY 2,001 shares @ PKR 278.00 — Jan 30, 2026

Significance: An executive accumulating shares at PKR 265–278 — well above the current price of ~PKR 210 — is a meaningful bullish signal. Insiders buying at higher prices than today's market confirms a value disconnect. The stock has fallen ~24% from insider purchase levels, representing a compelling entry for long-term investors.

Strategic

SWOT Analysis

S
Strengths
Pioneer & dominant E&P player — incorporated 1950, 75+ years of operations
Exceptional margins: 62.6% gross, 38% net — world-class for E&P
Huge, diversified exploration portfolio: ~52 blocks across Pakistan + UAE + Yemen
Deep value: P/B 0.78x, P/E 7x — significantly undervalued vs peers and book
Strong liquidity: Current ratio 4.57x, near-zero long-term debt at 8% of assets
Reko Diq strategic stake — billion-dollar copper-gold optionality
Insider buying at PKR 265-278 confirms fundamental value
SOE backing — Government of Pakistan via PSWF — systemic importance
W
Weaknesses
Revenue fell -16% YoY in FY25 due to lower oil prices + declining production
EPS declined -19.5% YoY in FY25 — negative earnings momentum
Natural field decline: production depletes without constant new discoveries
Circular debt: massive receivables tied up in SSGC and SNGPL
Low dividend yield (~3.6%) vs peers like POL (12%) — less income-oriented
Heavy exposure to domestic gas pricing — regulated prices limit upside
Large workforce (2,488 employees) — higher cost structure vs lean E&Ps
O
Opportunities
Reko Diq re-rating: as copper-gold mine progresses, asset value will be unlocked
Abu Dhabi offshore Block 5: development plan finalization — international upside
New discoveries (Baragzai, Nashpa Block, Mar 2026) replenish reserves
Circular debt resolution: gas price hikes improving SSGC/SNGPL collections
Pakistan's offshore campaign: 23 of 40 offshore blocks bid — sector-wide tailwind
Falling interest rates → higher P/E multiple re-rating potential for the stock
Tight gas and unconventional reserves — next frontier for domestic exploration
T
Threats
Global oil price decline (brent below $70) would directly compress revenue
Pakistan's energy transition risk — long-term gas demand may plateau
Regulatory/taxation changes — petroleum policy shifts or windfall taxes
Geopolitical risk — Yemen concession and cross-border operational risk
Currency risk: oil priced in USD, but costs partially in PKR — PKR appreciation risk
Circular debt spiral worsening if consumer gas prices are frozen again
Investment Case

⚖️ Bull vs. Bear Case

🟢 The Bull Case — Why Buy PPL Now
Trading at 0.78x book value — a rare deep discount for a profitable, state-backed E&P giant
Insiders bought at PKR 265–278 (24% above today's price) — they see intrinsic value
EPS has stabilised in Q2 FY26 — the worst of the earnings downturn appears over
Reko Diq is a massive hidden asset — copper-gold mine can unlock billions in value
8 out of 8 analysts rate PPL Strong Buy with consensus target of PKR 317 (+51% upside)
New hydrocarbon discoveries in 2026 signal active reserve replenishment
Gas price increases improving circular debt collections — the key financial blockage is clearing
Pakistan's offshore bidding boom brings sector-wide attention and re-rating
Falling domestic interest rates make PPL's yield and growth attractive vs. savings accounts
🔴 The Bear Case — Key Risks to Monitor
EPS down -19.5% YoY in FY25; H1 FY26 EPS of PKR 14.84 annualises to ~PKR 30 — below FY25's PKR 33.82
YTD 2026 price down -10.58% even after already correcting from 52-week high of PKR 284
Revenue shrinkage: FY25 sales fell 16% — structural production decline continues
Circular debt remains a drag on cash conversion — collections still uncertain timeline
Oil price risk: every $5/bbl drop in crude directly impacts EPS by ~PKR 1.5–2
Low dividend yield (3.6%) underperforms government savings rates — competes poorly as income stock
No near-term re-rating catalyst visible unless Reko Diq or Abu Dhabi delivers news
Ownership

🏛️ Ownership Structure & Corporate Profile

Shareholding

Total Shares Outstanding2,720,967,548
Majority ShareholderPakistan Sovereign Wealth Fund (PSWF) — via transfer from GOP
Free Float Shares669,385,480
Free Float %24.60%
Paid-Up CapitalPKR 27.21 Billion
Authorized CapitalPKR 50 Billion
Beta1.39 — Moderate-High Volatility

Management & Key People

CEOMohammad Khalid Rehman
ChairpersonShahab Rizvi
Company SecretaryAli Jaffar
AuditorKPMG Taseer Hadi & Co.
Registered AddressPIDC House, Dr. Ziauddin Ahmed Road, Karachi
Total Employees~2,488 (as of 2026)
Next Earnings DateApril 28, 2026
Strategy

📌 Investor Action Plan

Entry Strategy
PKR 195 – 220
Accumulate in the current zone of PKR 195–220. Strong support at ~PKR 195 (near 52-week lows). Scale in on any dips toward PKR 190. Staggered entry is preferred over lump-sum given current downtrend momentum.
Time Horizon
12 – 24 Months
PPL is a patient investor's play. Catalysts include Q3 FY26 earnings (Apr 28, 2026), circular debt resolution, Reko Diq news flow, and any oil price recovery above $85/bbl. Long-term holders benefit from compounding and potential dividend growth.
Risk Profile
Moderate-High
Beta of 1.39 means PPL moves ~40% more than the KSE-100. Suitable for investors with 2+ year horizon comfortable with commodity price and policy risk. Stop Loss: PKR 180 — below this level, thesis needs re-evaluation.

Position Sizing Guidelines

Conservative
3–5%
of portfolio — for income-focused investors
Moderate
5–10%
of portfolio — balanced growth + value play
Aggressive
10–15%
of portfolio — high-conviction deep value bet
MantrixEdge Final Verdict
STRONG BUY — THE DEEP VALUE ENERGY GIANT

PPL is Pakistan's oldest and most strategically significant E&P company, currently trading at a rare 22% discount to book value and at just 7x earnings — near historic lows. While FY25 earnings disappointed due to lower oil prices and production declines, the earnings have now stabilised in H1 FY26. The Reko Diq copper-gold stake, active new discoveries, improving circular debt collections, and 8 analysts rating it Strong Buy with a PKR 317 average target (51% upside) make this a compelling contrarian opportunity for patient investors.

Rating
Strong Buy
Target
PKR 270 – 320
Upside
+28% to +52%
Stop Loss
PKR 180
Horizon
12–24 Months

📚 Sources & Data

• PSX Data Portal (dps.psx.com.pk) — Price, financials, announcements, insider transactions
• Pakistan Petroleum Limited Official Website (ppl.com.pk) — Dividend notices, corporate briefings
• Standard Capital SCS Trade (scstrade.com) — Ratios, equity metrics, distributions
• Investing.com — Analyst consensus, price targets, 8 analyst ratings
• MarketScreener — PPL Analyst Briefing Presentation 2025
• Federal SOE Annual Aggregate Report FY2025 — Profit comparison across state enterprises
• PSX Financial Results Announcements (Q1 & Q2 FY26) — Feb 13, 2026
• All data as of March 14, 2026
Disclaimer: This analysis report is produced by MantrixEdge for informational and educational purposes only. It does not constitute financial advice, a solicitation to buy or sell, or an investment recommendation. Past performance is not indicative of future results. All investment decisions involve risk, including the possible loss of principal. Please consult a SECP-registered financial advisor before making any investment. Data sourced from PSX, company filings, and third-party financial platforms — accuracy is not guaranteed. MantrixEdge and its contributors hold no responsibility for investment outcomes based on this report.
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