PACRA Assigns Initial Ratings to Gas & Oil Pakistan Limited | GO Long Term Sukuk - I | PKR 2.5bln | Dec-25

Gas & Oil Pakistan Limited ("GO" or "the Company") benefits from a strategic partnership with Aramco, which holds an equity stake of ~40%, leveraging the global energy giant's resources to reshape Pakistan’s OMC landscape and GO’s market position. The financially sound sponsors contribute deep expertise across the energy supply chain, while governance has been reinforced through the induction of Aramco's representatives onto the Board of Directors and into key management roles. Operationally, GO maintains a substantial footprint, running an extensive retail network of about 1,329 outlets, including 80 COCO sites, 53 successfully rebranded under the Aramco name. Furthermore, the Company boasts the second-largest storage capacity in the sector at ~205,038 metric tons and supplements its income through hospitality services. Its operations encompass the procurement, storage, distribution, and marketing of petroleum, oil, and lubricants (POL) sourced both locally and internationally. GO has successfully stabilized its business and financial risk profile. During CY25, the Company has witnessed significant topline growth, clocking at ~PKR 619.6bln (CY24: PKR 327.8bln), reflecting the growth of ~89.0%. with improving profitability, a trajectory expected to persist due to effective marketing initiatives and sustained, stable cash flows. While the trade debts, mainly constituting government entities, corporate customers, and dealers stood at ~PKR 53.4bln (CY24: ~PKR 36.4bln), a growth of ~46.7%, is substantially slower than the annualized revenue growth, reflecting prudent working capital discipline, and is further supported by the implementation of a Board-approved credit policy aimed at maintaining tighter control over receivable cycles going forward. The Company’s working capital requirements are primarily met through sizable funded and non-funded banking lines, providing adequate liquidity headroom. The capital structure has also been materially strengthened through an equity injection by Aramco via a rights issue, enhancing overall financial flexibility and supporting the Company’s growth trajectory. The Company is aggressively expanding its retail fuel network, including opening new outlets to enhance market penetration and strengthen its operational footprint. To support this strategic expansion, a Long-Term, Rated, Secured, Privately Placed Sukuk of approximately PKR 2.5 billion has been issued, with the proceeds utilized for CAPEX, including the development of new outlets and upgrading existing infrastructure.
The ratings are dependent on keeping the growth trajectory, as a consequence of the above-mentioned association with Aramco, including the materialization of other governance and control-related matters.

About the Entity
GO was incorporated as a public unlisted company in 2012 under the repealed Companies Act 2017. The Company obtained the OMC license from OGRA in 2019. GO is engaged in the procurement, storage, distribution, and marketing of POL products and lubricants. Aramco holds ~40% stake in the Company, while ~60% stake resides with GO. Mr. Shahid Mehmood Khan chairs the Board, while Mr. Khalid Riaz heads the Company as the CEO.

About the Instrument
GO has issued Long-Term Sukuk, with a tenor of five years. The Sukuk carries a profit rate of 3MK + 1%. Proceeds from the issuance are being utilized to finance the expansion of the Company’s Company-Operated Company-Owned (COCO) retail fuel network. The instrument is secured against the Company’s existing COCO sites, with an independently assessed valuation of approximately ~PKR 3,483mln. The principal repayments will commence from the fifteenth month from the date of issuance and will be amortized through equal quarterly instalments over the remaining tenor.