Kohinoor Energy (PSX: KOHE), which owns a 124 MW furnace-oil power plant near Raiwind, Lahore, published its results for the first quarter of its 2027 financial year (July to September 2026) on 22 October 2026. Its only customer is the Central Power Purchasing Agency (CPPA-G).
The headline: a profit after tax of Rs 412 M, or Rs 2.43 a share, up 195% from Rs 140 M (Rs 0.82) a year earlier. That is the company’s best quarter in at least the last five, and more than half of its whole profit for the 2026 financial year (Rs 743 M). No dividend was announced with the results.
The quarter in numbers
| Rs M | Jul to Sep 2026 | Jul to Sep 2025 | Change |
|---|---|---|---|
| Electricity delivered, MWh | 79,503 | 13,150 | 6.0 times |
| Capacity factor | 29.0% | 4.8% | |
| Sales | 4,470 | 798 | 5.6 times |
| Fuel (raw material consumed) | (3,724) | (405) | 9.2 times |
| Other cost of sales | (197) | (171) | +15.2% |
| Gross profit | 549 | 223 | +146.6% |
| Administrative expenses | (78) | (70) | +10.2% |
| Other income | 2 | 3 | |
| Finance costs | (62) | (15) | 4.1 times |
| Profit before tax | 412 | 140 | +194.9% |
| Levy and tax | (0.05) | (1.0) | |
| Profit after tax | 412 | 140 | +195.2% |
| Earnings per share, Rs | 2.43 | 0.82 | +196% |
What drove the result
The grid called on the plant far more often. The directors put the increase down to higher load demand from the power purchaser. Monthly dispatch factors were 25.4% in July, 40.2% in August and 21.3% in September, against an average of 4.8% a year earlier.
Most of the extra revenue is fuel. Of the Rs 3.67 bn rise in sales, Rs 3.32 bn was matched by higher fuel cost. Sales less fuel cost rose to Rs 747 M from Rs 394 M, and gross profit more than doubled to Rs 549 M. Because fuel is such a large share of revenue at higher output, the gross margin fell to 12.3% from 27.9%, even though gross profit in rupees rose sharply.
Costs below gross profit stayed small. Administrative expenses rose 10% to Rs 78 M. Finance costs quadrupled to Rs 62 M as the company borrowed more to carry fuel stock and unpaid bills. Tax was almost nil, as it was a year earlier.
Cash and the balance sheet
- Profit has not yet turned into cash. Money owed by the power purchaser (trade debts) rose by Rs 1.08 bn in the quarter to Rs 3.62 bn, and fuel stock rose to Rs 933 M from Rs 548 M. As a result, operating cash flow was negative Rs 700 M, against positive Rs 353 M a year earlier.
- More short-term borrowing. Short-term finance rose to Rs 2.35 bn from Rs 2.05 bn, at rates of about 12.3% to 13.2%, and a Rs 500 M short-term investment was reduced to Rs 100 M.
- No long-term debt. Equity was Rs 5.22 bn. Current assets of Rs 5.68 bn exceed all liabilities of Rs 2.69 bn by about Rs 2.99 bn.
The big question: the power purchase agreement
The plant’s 30-year agreement with the power purchaser was extended by 161 days and now ends on 27 November 2027, about 13 months from now. The company has asked for a further extension, which the report says remains under consideration. Management is also looking at other options:
- Selling power directly to large industrial users near Lahore, including Sundar Industrial Estate, under the new competitive bilateral market that began operating on 22 January 2026.
- Converting the engines so they can also run as synchronous condensers, providing voltage and grid-stability services without burning fuel, if a commercial framework for these services is put in place.
- A memorandum of understanding signed on 1 October 2026 to set up a lithium-ion battery-pack assembly business.
The report says all of these depend on approvals, regulatory and commercial arrangements and agreements with customers that are not yet in place. The accounts are prepared on a going-concern basis.
Valuation snapshot
At the 28 October close of Rs 15.17:
| Measure | Value |
|---|---|
| Earnings per share, last 12 months (October 2025 to September 2026) | about Rs 6.0 |
| Price to earnings | about 2.5 times |
| Book value per share | about Rs 30.8, so price to book of about 0.49 |
| Current assets less all liabilities, per share | about Rs 17.6 |
| Market value (169.5 million shares) | about Rs 2.6 bn |
| Share price, last 52 weeks | low Rs 13.09, high Rs 19.74 |
The share jumped from Rs 14.39 to Rs 17.41 in the two sessions after the result, then gave most of it back. It trades at half its book value and below its net current assets per share. The low multiple reflects the short remaining life of the agreement: earnings depend on how often the grid calls on an oil-fired plant, and on what happens after November 2027.
What to watch next
- The PPA extension. The single biggest factor for the company’s value.
- Dispatch. Use of the plant swings widely, from 4.8% a year ago to 29% now, and the September figure was already lower than August’s. Profit depends on how often the grid calls on it.
- Collections. Whether the Rs 3.62 bn owed by the power purchaser is paid down, which would cut borrowing and finance costs.
- Dividends. With profit rising but cash tied up in receivables, whether the company resumes payouts.
- New businesses. Progress on bilateral supply, grid services and the battery venture.
The bottom line
Kohinoor Energy had a very strong quarter because the grid used its plant six times more than a year ago. Profit nearly tripled, but the cash is still owed by the power purchaser and the company borrowed more to fund fuel. The shares look cheap on earnings and assets, but with the power purchase agreement ending in November 2027 and no extension yet, the market is pricing the company as one with a short and uncertain runway.
You can follow KOHE’s price, Pulse Score, results calendar and off-market trades in the Market Pulse Hub dashboard under PSX.
Bilal, Market Pulse Hub
Source: Kohinoor Energy Limited, quarterly report for July to September 2026 (directors’ review and unaudited unconsolidated condensed interim financial statements). April to June 2026 profit is derived from the 2026 annual result less the first three quarters. Prices from the PSX data portal. Twelve-month, per-share and valuation figures are our calculations. This article is for education and information only and is not investment advice.