Pakistan Oxygen Limited (hereinafter referred to as ‘‘the Company’’ or ‘‘Pakistan Oxygen’’) is a public limited company incorporated in Pakistan in 1949, originally established under the name Pakistan Oxygen and Acetylene Company Limited. The Company has been listed on the Pakistan Stock Exchange since 1958 and trades under a ticker representative of its legal name. The Company's registered and principal business operations are conducted from Pakistan, with manufacturing sites, compression stations and sales offices spread across the country.

The Company traces its origins to the broader Oxygen and Acetylene group that established operations in the subcontinent in the mid-1930s, with the Pakistan entity formally incorporated in 1949 shortly after independence to serve the country's nascent industrial and healthcare gas requirements. The Company's early decades were spent building out air separation capacity to serve the domestic market, and it was renamed BOC Pakistan Limited in 1995 to align with its then parent, the BOC Group, a period during which capacity additions at Port Qasim and Multan extended the Company's manufacturing footprint beyond its original base. Following the global acquisition of BOC by the Linde Group in 2006, the Company was rebranded Linde Pakistan Limited in 2011 and continued to expand its nitrogen, carbon dioxide and specialized gas capabilities through the following decade, including the installation of a nitrogen generator dedicated to a major refinery customer and further compression capacity in Lahore. A pivotal ownership transition occurred in 2018, when a consortium comprising Adira Capital Holdings (Private) Limited, members of the Hilton Pharma family, Soorty Enterprises (Private) Limited, Al Karam Textile Mills (Private) Limited and individual sponsors acquired majority shareholding from the outgoing multinational parent, at which point the Company was renamed Pakistan Oxygen Limited, restoring its original identity. The post 2018 phase of the Company's history has been characterized by a significant organic capacity expansion programme rather than acquisition led growth, most notably the commissioning of a 270TPD air separation unit together with an 11 tonnes per shift electrode plant at Port Qasim in 2023, which lifted the Company's total production capacity from ~101.2 million cubic meters in 2021 to ~162.2 million cubic meters by 2025. This expansion phase was funded through a combination of equity and debt, with the Company raising ~PKR 749 million through the issue of ordinary shares in the year ended 31 December 2023 alongside term borrowings, and capital expenditure peaked at ~PKR 2.0 billion in that year before moderating substantially in the two subsequent years as the expansion programme approached completion and the Company transitioned toward internally generated cash flow as its principal source of funding. In 2025, the Company's board approved a further growth investment in a 500 normal cubic meter per hour hydrogen electrolyze plant, extending the Company's presence into green hydrogen production and positioning it within Pakistan's emerging national hydrogen strategy discussions.

The Company operates across four core business segments comprising bulk gases, healthcare gases, packaged gas products and tonnage supply, with an electrodes and welding products division contributing incremental revenue diversification. The Company owns and operates four air separation units located at Port Qasim, Karachi and Sundar Estate, Lahore, with individual nameplate capacities of 270TPD, 100TPD and 30TPD at Port Qasim, Karachi and 133TPD at Sundar Estate, Lahore. The Company also operates electrode manufacturing capacity of 11 tonnes per shift and 6 tonnes per shift at Port Qasim, Karachi. Additional specialised facilities include an electrolytic hydrogen plant at Port Qasim, a nitrous oxide plant at Lahore, dissolved acetylene plants at Karachi and Wah Cantt, and an on-site nitrogen plant at Mehmood Kot, supported by compression stations at Karachi, Sukkur, Faisalabad, Lahore and Taxila. The Company's total installed capacity stood at ~533TPD, or ~162.2million cubic metres on an annualised basis, as at the most recent measurement date, following aggressive expansion of ~60% since 2021, though actual capacity utilisation has trailed this expansion at ~40.4%, reflecting a broader structural under-utilisation trend across the domestic industrial gases sector rather than a company specific constraint. The Company maintains the largest geographic footprint and customer outreach within the domestic gases industry, serving in excess of ~1500 customers including nearly every major hospital across the country, supported by a delivery fleet of 43 bulk road tankers and an oxygen storage capacity of ~1.2million cubic metres, together with more than ~260bulk industrial and medical customer storage tanks installed at customer sites. Within the gases segment, the Company is positioned as the sole domestic producer of hydrogen and holds a pioneering position in medical engineering services, including the design, engineering and installation of medical gas pipeline systems, bed head units and alarm systems, an area in which it has developed indigenous equipment capability. The Company's revenue base is diversified across its gas product range, led by oxygen as the principal contributor, with nitrogen, electrodes, medical engineering services and hydrogen providing further diversification, and revenue is broadly balanced between the Company's northern and southern operating regions rather than concentrated in a single geography.

Adira Capital Holdings (Private) Limited, members of the Hilton Pharma family, Soorty Enterprises (Private) Limited, and Mr. Shahid Mahmood Umerani are the major shareholders of the Company, together holding ~ 77% of the total shareholding. Mr. Siraj Dadabhoy is the major beneficial shareholder.

The Company's ownership has demonstrated a stable consortium structure since the 2018 change of control, with the founding members of Adira Capital Holdings, comprising Mr. Waqar Ahmed Malik, Mr. Atif Riaz Bokhari, Mr. Siraj Ahmed Dadabhoy, Mr. Fawad Anwar, and Alpha Beta Capital Markets (Private) Limited, having jointly led the acquisition of the majority shareholding from the outgoing multinational parent. The sponsor consortium's stated share purchase agreement basis for the 2018 acquisition reflects a well-defined ownership arrangement among the constituent investor groups.

The sponsor group brings a combination of industrial, textile, and financial advisory experience to the Company. Mr. Shahid Mehmood Umerani, the Company's board chairman and a significant individual shareholder, and currently chairs ValuStrat Consulting Group, a Dubai-based advisory firm with offices across the Middle East and in Karachi and London, bringing more than four decades of leadership and business advisory experience to the Company's board. Soorty Enterprises (Private) Limited and its beneficial owners are established participants in Pakistan's textile and broader industrial sector, while the Hilton Pharma family's involvement in the original 2018 consortium reflects experience in the pharmaceutical and healthcare distribution space, a sector closely aligned with the Company's medical gases business line. Mr. Siraj Ahmed Dadabhoy, the Company's ultimate beneficial owner, is a certified public accountant with more than thirty years of professional experience and has maintained continuous board representation since the 2018 change of control.

The Company's sponsor group is described as a consortium of commercially and industrially focused investors, including prominent business groups and corporate sector professionals, assessed as possessing adequate financial strength to support the Company. At the time of the Company's acquisition in 2017 and 2018, both the Hilton family and Soorty Enterprises (Private) Limited were noted to hold substantial net assets. The sponsor group's demonstrated capacity to provide financial support to the Company was evidenced through the equity injection of ~749million rupees during the year ended December 2023, which coincided with the peak of the Company's capacity expansion capital expenditure programme, indicating a willingness on the part of shareholders to fund growth through equity rather than relying solely on external debt financing.

Following a board election held on 30 January 2026, the Company's board was substantially reconstituted and comprises ten members, split evenly between five non-executive directors, including the chairman, and five independent directors, with the next board election due on 30 January 2029. This composition reflects a governance structure in which independent representation constitutes half of total board strength. The board is supported by three standing committees: an Audit Committee, a Human Resource Remuneration and Nomination Committee, and a Business Risk and Sustainability Committee, each assisting the board across its respective mandate areas.

The reconstituted board, effective from the January 2026 election, comprises Mr. Shahid Mehmood Umerani as chairman in a non-executive capacity, bringing more than forty years of management consultancy and advisory experience through his chairmanship of ValuStrat Consulting Group; Mr. Siraj Ahmed Dadabhoy, a non-executive director and certified public accountant with more than thirty years of experience who also holds ultimate beneficial ownership of the Company's largest shareholding vehicle; Mr. Muhammad Iqbal Puri, a non-executive director holding a bachelor's degree in international business; Mr. Kamran Gul e Anwer, a non-executive director and chartered accountant with more than twenty years of experience; Mr. Muhammad Ashraf Bawany, a non-executive director holding FCMA and FCIS qualifications alongside a bachelor of commerce and a bachelor of laws degree; Mr. Tayyeb Afzal, an independent director and chartered accountant with more than forty five years of experience, the longest serving member of the current board; Mr. Arshad Mohsin Tayebaly, an independent director holding a master's degree in commercial law; Ms. Sadia Khan, an independent director holding a master's degree in economics and an MBA with more than thirty years of experience; Ms. Saadia Naveed, an independent director with more than twenty years of experience; and Dr. Sohail Razi Khan, an independent director holding a doctorate alongside MBA, MSc and MA qualifications. Six of the ten current directors, namely Mr. Bawany, Mr. Tayebaly, Ms. Khan, Ms. Naveed and Dr. Khan together with the elevation of Mr. Umerani to the chairmanship, joined or were elevated on the board following the January 2026 election, representing a substantial refresh of board composition relative to the board that served through 2025, while Mr. Dadabhoy, Mr. Puri, Mr. Anwer and Mr. Afzal provide continuity from the prior board. The board's collective professional background spans accountancy, corporate law, economics, management consultancy and engineering disciplines, providing a broad range of skills relevant to the Company's oversight requirements. The five independent directors on the reconstituted board meet the numerical composition typically expected under applicable governance requirements for independent representation.

The board has established a functioning oversight structure through its three standing committees, with the Audit Committee providing a specific channel of oversight over financial reporting and internal control matters. The roles of chairman and chief executive officer are held by separate individuals, with Mr. Shahid Mehmood Umerani serving as non-executive chairman and Mr. Farried Aman Shaikh serving as an interim chief executive officer, providing a structural separation between board oversight and executive management. Board meetings have been held regularly with generally high attendance across the review periods examined, supporting continuity of oversight notwithstanding the significant membership change that occurred at the January 2026 election.

BDO Ebrahim & Co. Chartered Accountants, with satisfactory QCR ratings and categorized as 'A' in the list of SBP-approved auditors, are the Company's external auditors. For the year-end-Dec'25, the firm expressed an unqualified opinion on the annual financial statements.

The Company's organizational structure is divided into distinct functional departments, with all department heads reporting directly to the chief executive officer. Within each department, a layered management hierarchy comprising multiple cadres enables the Company to carry out its operations across a geographically dispersed footprint. The delegation of authority within this structure allows functional heads operational decision-making latitude within their respective domains while strategic decisions are retained at the senior executive and board level, consistent with a moderately centralized decision-making model appropriate to the Company's scale and multi-site operations.

The Company's senior management team is led by Mr. Farried Aman Shaikh as interim Chief Executive Officer, who brings 35 years of experience with the Company, and Mr. Jamshed Azhar as Chief Financial Officer, whose professional career spans more than twenty years, including approximately seven years at Abbott Laboratories.

Management's functions are clearly defined and well-structured toward achieving the Company's underlying operational goals, supported by an internal control system that is assessed as being effectively implemented. The Company reported zero fatalities and no major safety incidents during the year ended 31 December 2025, reflecting positively on management's execution of its safety, health, environment and quality framework, which is supported by certification under ISO 45001, ISO 14001, ISO 9001 and FSSC 22000 standards together with a CE mark on relevant product lines.

The Company operates on an established SAP platform, specifically the ECC6.0 EHP-8 version, with modules covering sales and distribution, materials management, finance, plant maintenance, procurement and production planning, alongside an AXON module. The Company has additionally developed and deployed Kuick-App, a proprietary low code enterprise application platform positioned as Pakistan's first low code and no code platform, which supports workflow automation, analytics and dashboard reporting with real time key performance indicator tracking, deep integration with SAP, and Microsoft systems, role-based access control with active directory integration and a full audit trail, and flexible on premise, cloud or hybrid deployment. As at the most recent disclosure, this platform served more than sixteen enterprise customers with more than fifty pre-built templates and more than one hundred active proofs of concept deployments, indicating that the Company's information systems capability extends beyond internal use into a broader digital offering. This combination of an established ERP backbone and a purpose-built low code automation layer support management's ability to monitor operational and financial key performance indicators on a real-time basis.

The Company maintains a sound internal control system intended to reasonably assure the efficiency and effectiveness of operations, with the Board Audit Committee reviewing the internal control system based on periodic risk assessment and reporting to the full board. The internal audit function is outsourced to EY Ford Rhodes Consulting (Private) Limited, and reports functionally to the Board Audit Committee, providing an independent review channel separate from operational management.

The global industrial gases market expanded from ~USD 119.9 billion in calendar year 2024 to ~USD 128.3 billion in calendar year 2025, and is projected to grow at a compound annual growth rate of ~7.5% to reach ~USD 213.7 billion by calendar year 2032, reflecting rising industrialization, adoption of advanced applications such as semiconductor manufacturing and hydrogen based decarbonization, and expanding healthcare demand for medical and specialty gases globally. The Asia Pacific region held the highest share of global production at ~36.4% in CY2024, owing to increasing urbanization and industrialization, positioning Pakistan's domestic market within a broader regional growth trajectory even though the domestic sector itself remains a small and structurally self-sufficient segment of the national economy. Globally, the industry is dominated by a small number of multinational players including Air Liquide, Air Products, Linde PLC, Messer Group GmbH and Matheson Tri-Gas, a concentration pattern broadly mirrored at the domestic level, where the Pakistani market is organized as a duopoly between Pakistan Oxygen Limited and Ghani Chemicals Limited, which together held ~74% of sector market share in the year ended FY2025, with the balance held by smaller regional players including Multan Gases, Sharif Gases, Agha Gas, Sultan Oxygen and MediGas. This concentrated structure reflects high barriers to entry inherent to the sector, driven by the capital intensity of air separation infrastructure, the multi-year lead time required to commission new plants, and the logistical and regulatory requirements associated with medical gas supply to hospital networks. Within Pakistan, industrial activities contributed ~18% of nominal gross domestic product in the year ended FY25, with manufacturing comprising ~65% of that value addition and large-scale manufacturing in turn representing ~67.5% of manufacturing activity, underscoring the sector's structural linkage to the broader large scale manufacturing cycle even though industrial gases themselves constitute a negligible direct share of overall gross domestic product. The domestic industrial gases sector's revenue growth accelerated to ~13.8% during the 9MFY26, a sharp recovery from a contraction of ~11.7% in the corresponding period of the prior year, driven by a rebound in large-scale manufacturing activity, which grew ~6.5% during that period compared to a contraction of ~0.2% in the prior year period. On a full-year basis, sector revenue grew ~22.2% in the year ended FY25, supported by pricing improvements and expanded capacity notwithstanding a large-scale manufacturing contraction of ~0.8% during that year, illustrating the sector's demonstrated pricing power and its partial insulation from underlying manufacturing volume weakness through the combination of healthcare demand and effective cost pass-through. The sector remains structurally self-sufficient, with domestic production meeting ~99.7% of total consumption in the most recent measurement year and imported volumes consistently remaining below 1% of supply across the past five years, materially reducing the sector's exposure to foreign exchange volatility and global supply chain disruption relative to more import-dependent segments of Pakistan's industrial base. The sector's principal regulator is the Securities and Exchange Commission of Pakistan given the corporate and listed status of its major participants, while customs duty rates applicable to imported industrial gases were reduced materially in the year ending 30 June 2026 relative to the prior year, with total duty on gases such as hydrogen, oxygen and carbon dioxide falling from ~ 5% to 10% to between 0% and 5%, a development expected to marginally ease the cost of any imported gas volumes though its practical impact is limited given the sector's near total domestic self-sufficiency. The sector's demand is influenced by both economic cycles and stable healthcare needs. Industrial gas consumption is closely linked to large-scale manufacturing activity, particularly the automobile, food & beverage, chemical, and construction sectors, while demand for medical gases remains relatively resilient due to expanding hospital infrastructure and increased adoption of piped medical gas systems. The sector is highly exposed to rising electricity tariffs, its largest production cost, which increased by ~52% between FY21 and FY26.

Pakistan Oxygen Limited holds a leading position within the domestic industrial and medical gases sector, together with Ghani Chemicals Limited commanding ~74% of sector market share as at the year ended FY25. The Company's production capacity stood at ~162.2 million cubic meters, equivalent to ~533TPD, representing ~60% of the duopoly's combined cubic meter capacity. The Company's strong market presence nonetheless remains underpinned by its well-established nationwide footprint, the largest delivery vehicle fleet and customer storage tank base in the industry, its diversified customer portfolio spanning industrial, healthcare and government institutional customers, and its position as the sole domestic producer of hydrogen, an advantage not currently replicated by its principal competitor. Ghani Chemicals Limited, listed on the Pakistan Stock Exchange under the symbol GCIL, represents the Company's most directly comparable named peer, having recently commissioned a newer and more energy-efficient facility at Hattar, a factor that has narrowed the competitive gap in production efficiency between the two duopoly participants relative to the position in the Company's previous review. The smaller regional sector participants continue to operate at materially smaller scale within the remaining share of the market and do not carry the same national footprint or diversified product base as the two dominant players.

The Company recorded revenue of ~PKR3,614mln in 3MCY26, reflecting an ~11% increase over the corresponding period last year, primarily driven by an effective pricing strategy and steady volumes. For the full year ended Dec’25, revenue stood at ~PKR13,047mln, marking a ~15% rise from ~PKR11,345mln in Dec’24, which itself had grown ~32% over ~PKR8,589mln in Dec’23. By product, Oxygen remained the principal revenue contributor at ~46% of CY25 revenue (~PKR5,949mln), followed by Others (~15%), Nitrogen (~15%), Electrodes (~12%), Medical Engineering Services (~7%), and Hydrogen (~6%), with the gases segment as a whole continuing to anchor the topline while welding, hardgoods, and MES supported diversification. Geographically, revenue remained fairly balanced between the Company's Southern and Northern regions, with the South contributing ~49% of CY25 revenue. The sustained growth trajectory underscores the Company’s resilience amid a broader sector recovery, supported by a rebound in LSM activity.

In 3MCY26, the Company posted a gross profit margin of ~43.6% and a net profit margin of ~19.1%, building further on the improvement recorded in FY25, where margins stood at ~40.2% and ~12.8%, respectively (FY24: ~27.0% and ~6.3%). This sustained enhancement was supported by improved operational efficiencies, effective pricing measures, and easing input costs. The margin expansion is attributed to operational gains from the recently commissioned energy-efficient plant, along with distribution of fixed costs over a larger production base.

Pakistan Oxygen is one of the largest manufacturers of industrial and medical gases in Pakistan. The company has commissioned a state-of-the-art plant with an approximate capacity of 270 TPD ASU, along with an 11 TPS electrode plant, taking total production capacity to ~162.2mn cubic meters by 2025 from ~101.2mn cubic meters in 2021. These facilities, driven by world-class technology, offer cost-effectiveness and a competitive edge, with better specific power consumption enhancing operational efficiency. Despite this capacity base, utilization of the Company's core Oxygen/Nitrogen production remains modest at ~43.0% in FY25 (FY24: ~39.9%), providing meaningful headroom to absorb future volume growth as demand recovers.

As of Mar’26, net working capital days stood at 69, up from 62 days in FY25, mainly on account of an increase in trade receivable days to 64 (FY25: 56), partly offset by a decline in inventory days to 19 (FY25: 22) and payable days to 15 (FY25: 17). On a full year basis, net working capital days has increased to 62 in FY25, from 59 days in FY24, reflecting better receivable and inventory management despite a broader sector-wide extension in credit terms.

During 3MCY26, free cash flow from operations (FCFO) stood at ~PKR1,032mln, following a full-year FCFO of ~PKR4,447mln in FY25, up from ~PKR2,780mln in FY24. This improvement in operating cash flows, coupled with easing policy rates, translated into a marked strengthening of coverage metrics, with EBITDA to finance cost improving to ~18.6x in 3MCY26 (FY25: ~10.5x; FY24: ~2.9x) and FCFO to finance cost rising to ~13.4x (FY25: ~9.4x; FY24: ~2.8x).

As of Mar’26, the Company’s long-term borrowings stood at ~PKR2,162mln, compared to ~PKR2,274mln in FY25 and ~PKR3,899mln in FY24. Short-term borrowings were reported at ~PKR1,144mln (FY25: ~PKR1,632mln; FY24: ~PKR1,987mln), bringing total borrowings down to ~PKR3,771mln in Mar’26 (FY25: ~PKR4,371mln; FY24: ~PKR6,460mln). The leverage ratio (Total Borrowings / Total Borrowings + Shareholders' Equity) improved further to ~23.3% in Mar’26, from ~27.2% in FY25 and ~40.9% in FY24, reflecting continued deleveraging on the back of scheduled debt repayments and stronger internal cash generation.