We expect Hub Power Company Ltd (HUBC) to post NPAT of PkR18.3bn (EPS: 14.1/sh) for 1QFY25, up 7%YoY; however, down 10% on a QoQ basis. The incline mentioned above on a YoY is majorly led by lower finance costs amidst reduced debt levels during the period (Jun’24: PkR135bn, down 10%YoY). Overall, we expect company to post topline of PkR30.5bn, down by 10%YoY, on an annual basis amidst a lower generation profile (company-wide utilization: 14.1% vs. 21.1% in SPLY).

Notably, power offtakes from the company’s RFO and imported coal-based generators remain subdued, while indigenous coal IPPs remained active throughout, benefiting from a higher ranking in NTDC’s merit order. This will also be the final quarter before the capacity revenues from the company’s base plant are excluded from consolidated results, with the plant’s contract expiring as of Oct 1st, 2024.

On the non-operating front, the share of profit from associates is expected to be PkR11.6bn for the period (down 3% YoY). Finally, we do not anticipate the company’s announcement of a cash dividend during the period (vs. PkR5.0/sh in SPLY); however, any payout would be a positive development.