Latest news with #SanaTawfiq
Express Tribune
22-05-2025
- Business
- Express Tribune
Power generation hits 4-year high in April
Listen to article Pakistan's power generation in April 2025 surged to 10,513 gigawatt-hours (GWh), reflecting a robust 22% year-on-year (YoY) and 25% month-on-month (MoM) increase — the highest monthly generation recorded in the past 48 months, according to data published by the National Electric Power Regulatory Authority (NEPRA). "Power generation in April'25 surged by 22% YoY, highest in 48 months, to 10,513 GWh," wrote Arif Habib Limited (AHL). Despite this sharp rise, generation remained broadly aligned with the regulatory reference level, helping produce a positive Fuel Cost Adjustment (FCA) for the month, the first since June 2024. "Shift to expensive fuel mix resulted in the first positive FCA after June 2024," said Research Head of Optimus Capital, Maaz Azam. The uptick in generation is largely attributed to soaring electricity demand, spurred by rising temperatures and reduced reliance by industries on captive power generation. Analysts believe the shift was also influenced by lower grid tariffs, which made national grid electricity more attractive compared to captive sources. "The rise in generation is attributed to increased demand, driven by a reduction in tariffs," said Research Head of AHL, Sana Tawfiq. Cumulative power generation during the first 10 months of the fiscal year 2025 (10MFY25) reached 100,661 GWh, showing a marginal decline of 0.4% YoY from the same period last year. In terms of source-wise contribution, hydropower (hydel) led the mix with 2,306 GWh (22% share), up 11% YoY, followed by re-gasified liquefied natural gas (RLNG) at 2,157 GWh (21%) and nuclear at 1,882 GWh (18%). A notable highlight was the 59% YoY growth in local coal-based generation, which rose to 1,540 GWh, supported by increased utilisation and favourable fuel costs. Conversely, generation from imported coal and natural gas declined by 32% and 26% YoY, respectively, reflecting deliberate cost-cutting and fuel optimisation strategies. Wind and solar energy maintained a combined share of 9.2%, consistent with seasonal patterns, while residual fuel oil (RFO) re-entered the generation mix with 83 GWh at a steep cost of Rs28.77/kWh. From a policy perspective, a significant development in March 2025 was the imposition of a Rs791/mmbtu levy on gas-based captive power plants (CPPs), raising their effective gas tariff to Rs4,291/mmbtu. According to estimates by AKD Securities, this translates into a staggering generation cost of around Rs42/kWh for off-grid captive units operating at 35% thermal efficiency. This steep cost differential prompted many industrial users to switch to relatively cheaper grid electricity, which averaged around Rs28/kWh (excluding taxes and duties). While the fuel cost of power generation rose by 8% YoY to Rs9.92/kWh in April 2025, driven by a heavier reliance on expensive fuels like RLNG and RFO, the average cost of generation actually fell on a MoM and YoY basis. It dropped to Rs8.95/kWh, down 5% YoY and 8% MoM, compared to Rs9.75/kWh in April 2024reflecting improved fuel mix efficiency and lower reliance on imported fuels. According to Optimus Capital Management, the total generation of 10,513 GWh in April was slightly below the reference level of 10,550 GWh, a shortfall of just 0.4%. However, changes in the fuel mix were stark. Hydel power dropped by 28.6% versus its reference (3,228 GWh), while coal-fired generation soared by 48.6%, with imported coal usage jumping 115.1% and local coal rising 22.5%. Meanwhile, RLNG generation grew by 42.1%, and nuclear generation fell by 22.3%. The cost impact of this fuel mix shift was significant. RLNG's contribution to fuel cost jumped to Rs4.98/kWh, up from a reference of Rs3.31/kWh. Local and imported coal together contributed Rs3.30/kWh, while nuclear (Rs0.38/kWh) and hydel (zero marginal cost) remained low-cost contributors. The net result was a positive FCA of Rs1.27/kWh, calculated against a reference fuel cost of Rs7.68/kWh. This marked change in fuel mix, particularly the increased reliance on RLNG and coal, alongside stable generation levels, led to the country's first positive FCA adjustment in 10 months, a noteworthy development for both consumers and the broader energy sector.
Gulf Today
12-05-2025
- Business
- Gulf Today
Pakistan's stock, international bonds soar after ceasefire with India
"While optimistic, sustaining momentum requires ceasefire compliance, accelerated reforms, and managing global headwinds like oil prices," senior economist Sanie Khan told AFP. Pakistan's stocks closed up 9.4% and its international bonds also recorded strong gains on Monday after a ceasefire deal with neighbouring India agreed over the weekend fuelled a relief rally. Pakistan's main stocks benchmark — the KSE-100 share index — rose 9.6%, to its highest level since April 23, and closed at 9.4%, marking its highest ever gain in terms of points and percentage. The benchmark KSE-100 Index opened at 117,104.11 points, up 9,929.48 points, or 9.26 per cent, prompting an hour-long trading suspension because limits had been reached. "Today's sharp surge in the stock market stems from a powerful convergence of bullish triggers that have swiftly turned investor sentiment from fear to opportunity," Sana Tawfiq, head of research at Arif Habib Limited, Pakistan's largest securities brokerage, told AFP. The country's international bonds rallied sharply, adding as much as 5.7 cents in the dollar, Tradeweb data showed. The jump also comes on the back of the International Monetary Fund (IMF) on Friday approving a Pakistan loan-programme review, unlocking around $1 billion in much-needed funds and greenlighting a new $1.4 billion bailout despite India's objections. "We are very pleased today that the market has performed extremely well," Ahmed Chinoy, director of the Pakistan Stock Exchange Limited, told AFP, while celebrating by cutting a cake with brokers. "This positive shift is reinforced by the IMF's dual approvals, providing both critical funding and international validation of Pakistan's reform path," Tawfiq added. Saturday's ceasefire in the region, announced by US President Donald Trump, followed four days of fighting and diplomacy and pressure from Washington. "After four days of tense clashes that pushed India and Pakistan close to war, a ceasefire appears to be holding after being announced on Saturday," said Jim Reid at Deutsche Bank in a note to clients. The gains in stocks came after the exchange halted trading on Monday for an hour, according to an exchange notification. In a research note, Arif Habib Limited said that while a ceasefire and diplomatic progress have boosted optimism, unforeseen escalations remained a risk. The US president pledging support for resolving the Kashmir issue and encouraging enhanced trade relations between India and Pakistan, the IMF's nod on Pakistan, as well as the central bank's 100 basis points rate key rate cut last Monday which is "expected to boost equity valuations," should all encourage stability, the note said. In a series of posts on social media, Trump also pledged to increase trade with both nations. A policy rate cut by the country's central bank was also seen as a positive factor boosting equity flows. Agencies
Al Arabiya
12-05-2025
- Business
- Al Arabiya
Pakistan stocks surge after ceasefire with India
Pakistan stocks surged on Monday, with the benchmark index opening nine percent higher after a weekend ceasefire agreement with the country's arch rival India. United States President Donald Trump announced the truce after four days of missile, drone and artillery attacks by India and Pakistan which killed at least 60 people and reached deep into the territory of both countries. The benchmark KSE-100 Index opened at 117,104.11 points, up 9,929.48 points, or by 9.26 percent. 'Today's sharp surge in the stock market stems from a powerful convergence of bullish triggers that have swiftly turned investor sentiment from fear to opportunity,' Sana Tawfiq, head of research at Arif Habib Limited, Pakistan's largest securities brokerage, told AFP. The jump also came after the International Monetary Fund (IMF) on Friday approved a loan program review for Pakistan, unlocking around $1 billion in much-needed funds and greenlighting a new $1.4 billion bailout despite India's objections. 'This positive shift is reinforced by the IMF's dual approvals, providing both critical funding and international validation of Pakistan's reform path,' Tawfiq added. Trump, in a series of posts on social media announcing the ceasefire mediated by the US, pledged to increase trade 'substantially' with both nations. 'While optimistic, sustaining momentum requires ceasefire compliance, accelerated reforms, and managing global headwinds like oil prices,' senior economist Sanie Khan told AFP. A policy rate cut by the country's central bank was also seen as a positive factor boosting equity flows.
Express Tribune
10-05-2025
- Business
- Express Tribune
Remittances boom fades in April
Listen to article Buoyant remittances, relied upon by the government to support its external financing needs, have witnessed a sharp 22% decline on a month-on-month basis in April 2025. This drop, following record inflows in March, has raised concerns over a potential current account deficit, which analysts estimate could fall between $350 and $400 million for the month. Pakistan received workers' remittances worth $ 3.2 billion in April 2025, according to data released by the State Bank of Pakistan (SBP). This marks a 13.1% increase on a year-on-year basis, reflecting a continued trend of strong inflows from overseas Pakistanis. The cumulative inflow during Jul-Apr FY25 has now reached $31.2 billion, representing a significant 30.9% rise compared to $23.9 billion in the same period last fiscal year. Key contributors to April's inflows were Saudi Arabia ($725.4 million), the United Arab Emirates ($657.6 million), the United Kingdom ($535.3 million), and the United States ($302.4 million). "Although April's inflows were solid, they showed a month-on-month (MoM)decline when compared to the exceptionally high figure of $4.1 billion in March 2025," Commenting on the latest figures, Sana Tawfiq, Head of Research at Arif Habib Limited (AHL), told The Express Tribune. She attributed this dip to the end of seasonal factors, particularly the surge in remittances seen during Ramzan and Eid, which traditionally lead to a temporary spike in transfers. "Now that the Eid-related effect has subsided, a MoM correction was expected," she stated. Tawfiq emphasised that despite the decline from March, the average run-rate of remittances remains strong, which is a positive indicator for the economy. Tawfiq also highlighted potential challenges for the external account, forecasting a current account deficit for April 2025, estimated in the range of $350400 million. She pointed to the $5.5 billion import bill, as reflected in preliminary dat of Pakistan Bureau of Statistics (PBS), as a primary factor contributing to this deficit. While the SBP's final balance-of-payments data is still pending, the trade figures suggest a temporary widening in the current account gap. However, Tawfiq maintained an optimistic outlook for the full fiscal year, projecting a current account surplus of around $1.3 billion for FY25, assuming stability in remittance inflows and controlled imports. Despite the short-term dip in April and a likely one-off deficit, the broader trend in workers' remittances remains favourable. These inflows continue to serve as a crucial buffer for Pakistan's external account, supporting macroeconomic stability amid global and domestic challenges. Ali Najib, Head of Sales Insight Securities, said the increase in workers' remittances is primarily attributable to exchange rate stability, regulatory measures against informal transfer channels, growth in overseas employment, expansion of digital banking infrastructure, and supportive government policies. These factors collectively enhanced formal remittance inflows and bolstered external sector stability. The current remittance growth, driven by increased labour migration to GCC countries, especially Saudi Arabia and the UAE, where regulatory reforms appear sustainable in the near term. However, evolving visa policies in those countries and potential economic fluctuations (especially the consistent declining trend in international oil prices) in the Gulf region pose medium-term risks to this trajectory. "Government should focus on diversifying remittance sources before it gets too late," said Najib. Waqas Ghani Kukaswadia, Research Head of JS Global, said the current trajectory appears promising, especially with sustained labour demand in Saudi Arabia in the coming years. However, sustainability from the UAE remains uncertain due to a marked slowdown in labour exports to the country. If Pakistan is able to negotiate more flexible immigration policies with the UAE, it could unlock further growth in remittances. Overall, the trend is positive, but continued momentum will depend on maintaining currency stability and expanding labour market access in key Gulf economies. The data on workers' remittances for April 2025 highlights several challenges that Pakistan faces in maintaining stable inflows from its diaspora. One key issue is the declining or volatile remittances from certain regions, such as the GCC countries (excluding Saudi Arabia and the UAE), where nations like Bahrain and Kuwait recorded negative growth in FY24. Similarly, remittances from Japan and Canada saw significant drops in FY24, with Japan experiencing a sharp 33.3% decline. While some countries, like South Africa, rebounded strongly in FY25, their earlier negative growth underscores instability in these markets. Another concern is the monthly volatility in remittance flows. For instance, remittances fell by 21.5% from March to April 2025, and the year-on-year growth for April (13.1%) was notably lower than March's 37.2%. Such fluctuations make it difficult to predict and plan for consistent foreign exchange earnings. Additionally, Pakistan's heavy reliance on a few key countriesSaudi Arabia, the UAE, the UK, and the USfor over half of its remittances poses a risk, as economic downturns or policy changes in these nations could disproportionately impact inflows. The data also reveals underperformance in some EU countries, such as the Netherlands and Denmark, where remittances contracted in FY24 despite overall growth in the region.
Express Tribune
24-04-2025
- Business
- Express Tribune
Debt payments reduce reserves by $367m
Net financial inflows, though tepid during 1HFY25, are expected to improve as a sizable part of official debt repayments has already been made. photo: file Listen to article Owing to external debt payments, the State Bank of Pakistan's (SBP) foreign exchange reserves fell $367 million over the week, reaching $10.21 billion as of April 18, according to data released on Thursday. The country's total liquid foreign reserves stood at $15.44 billion, with $5.23 billion held by commercial banks. "Earlier, on March 21, 2025, the SBP had reported a week-on-week decline of $540 million," said Arif Habib Limited Research Head Sana Tawfiq while talking to The Express Tribune. The central bank attributed the latest drop to external debt payments, stating: "During the week ended April 18, 2025, the SBP reserves declined $367 million to $10,205.9 million due to external debt repayments." The Pakistani rupee weakened against the US dollar on Thursday, slipping 0.04% to reach its lowest level in over a year in the inter-bank market. By the end of trading, the rupee stood at 281.07 against the dollar – a level last seen in January 2024. A day earlier, the local currency had closed at 280.97. The dollar staged a broad retreat in the global market as investor gloom over the lack of progress towards defusing the US-China trade war reasserted itself following an interlude of optimism the previous day. US assets, including the dollar, rallied on Wednesday after President Donald Trump backed down from threats to fire the head of the Federal Reserve and appeared to soften his stance on China. Meanwhile, gold prices in Pakistan remained stable, mirroring the lack of movement in the international market. According to the All Pakistan Sarafa Gems and Jewellers Association (APSGJA), the price of gold per tola held steady at Rs352,000. Similarly, the price for 10 grams of gold remained unchanged at Rs301,783. This followed Wednesday's fluctuation when gold per tola dropped Rs11,700 to Rs352,000. On the global front, the price of gold also stayed flat, standing at $3,338 per ounce (including a $20 premium), the same as on the previous day, as per the APSGJA data. Adnan Agar, Director at Interactive Commodities, stated that gold prices were trading within a defined range without any significant developments to prompt further movement. "The market is currently positioned at $3,335, with a low of $3,310 and a high between $3,370 and $3,375," he said. "At the moment, there's no new trigger influencing the market direction. Any major update, particularly related to China or other significant events, would be necessary to drive further activity." He noted that the previous session saw a low of $3,270, from which the market has rebounded. Internationally, gold prices gained after falling more than 3% in the previous session, helped by a subdued dollar and bargain hunting, while market attention remained focused on any updates on US-China trade relations. Spot gold rose 1% to $3,321.09 an ounce. Bullion hit a record high of $3,500.05 on Tuesday due to concerns about the US economy, but prices retreated on Wednesday after Trump backed down from threats to fire the head of the Federal Reserve and appeared to soften his stance on China.
