{
  "id": 12285605,
  "title": "Power sector losses drag state-owned entities' profits",
  "url": "https://urgent.news/2026/10/06/power-sector-losses-drag-state-owned-entities-profits",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-10-06T02:57:37.000Z",
  "source": {
    "name": "Dawn Business",
    "slug": "dawn-business",
    "url": "https://www.dawn.com/news/2035050/power-sector-losses-drag-state-owned-entities-profits"
  },
  "original_language": "en",
  "account": "Islamabad: The financial health of Pakistan's state-owned entities (SOEs) deteriorated significantly in the first half of FY26, with aggregate profitability plummeting by 30 per cent. This decline affected all seven core performance areas, raising fiscal and macroeconomic risks for the nation. The power sector, the weakest performer, saw a Rs374bn increase in circular debt, equivalent to 11pc of total federal budgetary receipts, due to inefficiencies and poor recoveries. Fiscal support, mainly through subsidies, grants, loans, and equity injections, reached nearly Rs6.6bn per day to offset the losses, estimated at Rs2.8bn per day. The SOEs' overall balance sheet remained highly leveraged, with debt exceeding Rs10tr, including Rs2.5tr in foreign currency liabilities. This exposed the country to exchange rate risks, refinancing pressures, and external account volatility. The report highlighted that while there was a slight dip in losses, the narrowing profit-loss spread indicated increasing fiscal and operational pressures. The SOE sector's financial position slipped slightly, with equity falling by 3pc and total assets down by 2pc. Nevertheless, the declining equity level, combined with high leverage, left the sector vulnerable to fiscal and refinancing risks, especially in capital-intensive industries like power, infrastructure, and transport.",
  "summary": "ISLAMABAD: The aggregate profitability of the state-owned entities (SOEs) contracted by 30 per cent in the first half of FY26 as their overall performance deteriorated across seven core areas, increasing fiscal and material macroeconomic risks to the sovereign state of Pakistan. According to the July-December 2025 SOEs Monitoring Report, released on Monday by the Ministry of Finance, the power…",
  "key_points": [
    "State-owned entities' profits dropped 30% in FY26 first half",
    "Power sector's circular debt rose 11% to Rs374bn",
    "Fiscal support exceeded Rs6.6bn daily to offset losses"
  ],
  "editors_take": "The widening losses in state-owned entities, driven by the power sector's dismal performance, heighten fiscal and macroeconomic risks for Pakistan and expose the country to exchange rate and refinancing pressures.",
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}