⚡ Flash Summary

On November 25, 2025, Oil & Gas Development Company Limited (OGDCL) announced the receipt of the fifth interest payment under Term Finance Certificates (TFCs) from Power Holding Limited (PHL). This installment is part of a circular debt settlement plan approved by the Government of Pakistan (GOP). The payment amounts to Rs 7.725 billion and is one of twelve equal monthly installments. The total interest to be repaid is Rs 92 billion, with installments commencing in July 2025, reflecting the GOP’s efforts to resolve circular debt in the energy sector.

📌 Key Takeaways

• 💰OGDCL received its fifth interest payment under TFCs.
• ✅The payment is part of the circular debt settlement plan.
• 🏢The payment was made by Power Holding Limited (PHL).
• 🤝The settlement plan is approved by the Government of Pakistan (GOP).
• 💸The installment amount is Rs 7.725 billion.
• 🗓️The payment is one of twelve equal monthly installments.
• 📈The total interest to be repaid is Rs 92 billion.
• 🗓️Installments commenced in July 2025.
• ⚡This reflects progress in addressing circular debt in the energy sector.
• 📜Compliance with Section 96 of the Securities Act, 2015 and PSX Regulations.
• ✉️The announcement was made to the Pakistan Stock Exchange Limited.
• 🏢PHL is a private limited company.

🎯 Investment Thesis

HOLD. While the receipt of the interest payment is a positive development, it is only one installment in a larger repayment plan. A ‘HOLD’ recommendation is appropriate until the full impact of the circular debt settlement on OGDCL’s financials is clearer. A price target cannot be accurately determined without further financial information, but the stabilization of cash flows contributes to long term stability.

⚡ Flash Summary

OGDCL’s Corporate Briefing Session 2025 highlights its operational and financial performance for the year. The company reported a net profit of Rs 169.904 billion. OGDCL’s share of oil, gas and LPG production accounted for 49%, 28%, and 34% respectively. The company is actively pursuing business diversification, including the Reko Diq Mining Project, Abu Dhabi Offshore Block-5, and Geothermal Energy Project.

📌 Key Takeaways

• 🥇 OGDCL’s Net Profit reached Rs 169.904 billion.
• ⛏️ Reko Diq Mining project’s feasibility study was completed in January 2025.
• 🌍 Abu Dhabi Offshore Block-5 development plan approved by ADNOC.
• 🔥 Focus on geothermal and solar energy opportunities.
• 🧪 New reservoir stimulation technology successfully tested.
• 🛢️10 ESPs installed at multiple wells, initial impact of 8000 BPD.
• 💰 Foreign exchange savings of US$ 3.192 billion by substituting imports.
• 📜 First ESG report launched at COP-29 in Baku on 11 November 2024.
• 🛢️ Total oil reserves in the country is 240 MMBBL, with OGDCL’s share being 118 MMBBL (49%).
• ⛽ Total gas reserves in the country is 18,981 BCF, with OGDCL’s share being 5,790 BCF (31%).
• 🤝 Alliance forming with JVs for risk sharing and knowledge transfer.
• 🏆 Awarded Corporate Excellence Award 2024 for management practices and visionary leadership.
• 💸 Distributed 7,000 Ramadan ration bags worth Rs 214 million.
• 🚧 Constructed 30 resilient homes in flood-affected areas.
• 👨‍🎓 440 students selected for zero semester at IBA Karachi and Sukkur IBA.

🎯 Investment Thesis

OGDCL is a leading oil and gas company in Pakistan with significant reserves and production. However, the challenges related to circular debt, production curtailments, and regulatory risks are impacting its profitability and cash flows. Given these risks, a HOLD recommendation is appropriate at this time. The price target rationale is based on the current earnings multiple of 5.58x and EPS of 39.50, giving a share price of around 220 Rs, which is inline with market price. Thus, Hold.