The principal activities of Kohinoor Energy Limited (KEL or the Company) is to own, operate, and maintain a furnace oil power station with a net capacity of 124 MW. The plant is situated at 35-KM Link Manga Raiwind Road,Lahore. The main equipment at the power complex includes eight (8) WARTSILA Diesel 18V46 Type Diesel Generators, Steam turbine, and three (3) ABB 63 MVA Step-Up Transformers converting the electrical output from 11 kV to 132 kV.

The Company's key source of earnings is the generation tariff from the power purchaser, WAPDA. The reference generation tariff comprises a capacity charge component and an energy charge component. The former is based upon dependable capacity and constitutes a minimum tariff guaranteed to the Company which covers the O&M costs, insurance charges, working capital funding costs, and return on equity. The levelized tariff for the period of 30 years is US cents/kWh 5.2492.

The O&M component of the Energy Invoice is indexed with variations in the US Dollar exchange rate and US CPI to account for foreign currency exposure and inflationary movements in operating costs. Meanwhile, the Capacity Purchase Price (CPP) is indexed with the National Consumer Price Index (NCPI), allowing adjustments in line with domestic inflation.

The Saigol family owns 62% of the shareholding of the Company through different family members (34.56%) and associated companies and related parties (27.48%). Wartsila Finland holds a 2% stake in the Company while the remaining ownership stake is held by various institutions, including DFIs, NBFIs, FIs, insurance companies, modarabas and mutual funds, and individuals

The ownership stake of the Company has remained stable over the years, with the major stake belonging to the Saigol family. Moreover, the ownership structure is expected to remain stable due to the nature of the project and the long-term agreements signed with the government and its other related entities

KEL was amongst the pioneer projects of Independent Power Producers in Pakistan. Additionally, the sponsors have also previously successfully developed and operated a 15 MW furnace oil power station in Faisalabad under Kohinoor Power Company Limited. Hence, the sponsors have vast experience and knowledge about the local power sector along with expertise in successfully delivering projects.

Saigol Group stands as a leading group in the industrial and commercial sector of Pakistan and holds a majority shareholding in the company. Major businesses of the group comprise textiles, home appliances, electrical equipment manufacturing, and power generation.

As of June 2025, the Company's board comprises seven directors, including two non-executive and three independent directors, along with two executive directors, including the CEO of the company. Three members represent the interests of the Saigol group, while one director represents Wartsila.

Mr. M. Naseem Saigol has been the Chairman of the board since the inception of KEL. He is leading the Saigol group in diverse business sectors and thus possesses leadership and entrepreneurial expertise. Mr. M. Naseem Saigol, through his business group in terms of services, manufacturing home appliances and electrical equipment, textile products and exports thereof, and power generation, has contributed towards the economic development of the country. Mr. Muhammad Murad Saigol is working as Chief Executive and Managing Director of PAK ELEKTRON LIMITED (PEL). He looks after all of the strategic and operational affairs of the company. He joined PEL in 2005 and achieved certain landmarks. He is a Corporate Governance Certied Director under the Directors Training Program. He is also on the boards of other related entities of the group. Syed Manzar Hassan is a Fellow Member of the Institute of Chartered Accountants of Pakistan. He has over 20 years of experience in nancial management, nancial management reporting, and handling corporate matters with a specialization in corporate nance. He is an Executive Director on the Board and Chief Financial Ofcer of PEL. Mr. Faisal Riaz has done Cost and Management Accountancy (CMA) from the Institute of Cost & Management Accountants of Pakistan. He has been associated with Wärtsilä since 2005, and during his tenure, he has performed different roles. Since Nov 01, 2018, Mr. Faisal has also been performing as Managing Director/Chief Executive Ofcer of Wärtsilä Pakistan (Pvt.) Limited, and since Jan 07, 2019, he has also been assigned to the Board of KEL as director.

The board has made two committees, namely the Audit Committee and the Human Resource & Remuneration Committee, which ensure effective governance of the company. The directors of the company have attended directors training programs as per the mandatory requirement of SECP to ensure that they are aware of their duties and responsibilities and can effectively manage the affairs of listed companies on behalf of the shareholders

Being a publicly listed company, KEL has to abide by the code of corporate governance, which includes timely preparation and dissemination of nancial accounts and other material information related to the Company's operations. A.F. Ferguson & Co. Chartered Accountants are the external auditors of the company. They expressed an unqualied opinion on the company’s nancial statements as of June 30th, 2025. Furthermore, the auditors have drawn attention to the uncertainties regarding the outcome of certain claims by the Central Power Purchasing Agency (“CPPA-G”), which have been disputed by the Company. The opinion is not qualied in respect of this matter.

The management's role in an IPP is conned largely to nancial matters and regulatory interaction. In light of this, KEL has a lean organizational structure. The organizational structure of the company is divided into two major functional areas (i) Technical and (ii) Support functions.

Mr. Zeid Yousaf Saigol is the CEO of the company. He has been associated as Executive Director with Pak Elektron Limited since 2011 and is leading the Company's Power Division Operations. He is also on the board of Saritow Spinning Mills Limited, Kohinoor Power Company Limited, and Kohinoor Industries Limited. He is a Corporate Governance Certied Director under the Directors Training Program. He is accompanied by a small team of senior management professionals having relevant experience in the industry.

Over the years, the company’s effective management played a significant role in empowering the organization through its progressive results. Additionally, management’s effective decision-making causes processes to be more systematic, while the robustness of control systems is considered a reection of strong management.

The management has adopted, as far as practicable, all the internal control policies and procedures in achieving management's objectives of ensuring, as far as practicable, the orderly and efcient conduct of its business, including adherence to management policies, safeguarding of assets, prevention and detection of fraud and error, accuracy and completeness of accounting records, and timely preparation of reliable nancial information.

KEL has an exclusive 30-year Power Purchase Agreement (PPA) with CPPA-G (the power purchaser) starting from the Commercial Operations Date. KEL has agreed to the amendments to the Power Purchase Agreement as proposed by the Task Force constituted by the Prime Minister of Pakistan to convert the existing tariff to a 'Hybrid Take and Pay' model. During the year, the Company entered into negotiations with the National Task Force on Implementation of Structural Reforms (Power Sector) regarding amendments to the Power Purchase Agreement (PPA). As a result, an Amendment Agreement was signed with CPPA-G on February 19, 2025. Under this agreement, and in lieu of the settlement of previously disputed liquidated damages (LDs), the PPA has been extended by 161 days from June 20, 2027, to November 27, 2027, under the Other Force Majeure Event (OFME) clause of the PPA. 

Previously, O&M activities were handled in-house while major maintenance work was managed by Wartsila Pakistan. Since 2016, the Company started to undertake major O&M in-house that has produced a meaningful outcome.

KEL has an exclusive 30-year Fuel Supply Agreement (FSA) with Pakistan State Oil (the fuel supplier), which ensures uninterrupted supply of fuel to maintain the plant's availability.

The Company has adequate insurance coverage for property damage and business interruption of the plant.

The industry dynamics of Pakistan's power sector in 2024-2025 are marked by a stable outlook despite a decline in overall power generation. While total installed capacity rose 11% to 46,605 MW by 9MFY25—largely due to a 2,813 MW increase in renewable energy net metering—actual generation fell by 2%, leading to a lower average capacity factor of 22.1%. This shift in capacity occurred alongside the government’s termination of Power Purchase Agreements (PPAs) with several Independent Power Producers (IPPs). The sector remains heavily dependent on thermal power, which accounts for the largest share of both capacity and generation, followed by hydel, nuclear, and renewable sources. Financially, the industry continues to grapple with a circular debt of approximately PKR 2.4 trillion, which the government is addressing through a combination of federal budget allocations and PKR 1.25 trillion in commercial bank loans to be repaid over six years via existing surcharges. Additionally, sector borrowing decreased by 7% to PKR 471,790 million by June 2025, with coal and thermal plants remaining the most heavily leveraged entities.

The generation from the plant depends on the overall demand from the power purchaser of the specific plant. During 2QFY26, the demand for electricity from CPPA remained lower compared to the corresponding period of the previous year. The plant operated at a capacity factor of 3.47%, delivering 19,020 MWh to WAPDA, compared to 4.29% capacity factor and 23,449 MWh during the same period last year.

The Company meets its availability and efciency benchmarks as required under the PPA, resulting in smooth and uninterrupted operations of the plant.

The Company successfully repaid its long-term project-related debt by 2008

The piling of circular debt in the power sector remains a challenge for the IPPs, including the Company, leading to delayed payments from CPPAG against Energy and Capacity invoices. As of the end of December 2025, the receivables stand at PKR ~1,208mln, witnessing a decrease from the end of December 2024 of PKR 2,288mln. The major portion of the trade debts has been paid by the power purchaser, enhancing the Company's liquidity profile. The Company manages liquidity risk by maintaining sufficient cash and the availability of funding through an adequate amount of committed credit facilities

KEL manages its working capital through a mix of internal cash generation and uses short-term working capital lines to bridge the delay in payments from the power purchaser. As of the end of December 2025, short-term borrowings stood at PKR 843mln, representing ~21% utilization of the approved limits.

During December 2025, the Company's FCFO stood at PKR 364mln, reflecting a stable position supported by consistent profitability and the prevailing tariff structure. However, following the implementation of amendments in the PPA and the introduction of a new hybrid tariff structure, the Company has started witnessing a decline in profitability and FCFOs.

As the long-term project debt stands repaid, the borrowings comprise 100% short-term financing to support ongoing operations. As of the end of December 2025, the leveraging ratio stood at 16.4%. The Company's equity base witnessed incline and stood at PKR 4,289mln ( December 2024: PKR 3,665mln).