PACRA Maintains Entity Ratings of Gas & Oil Pakistan Limited

Gas & Oil Pakistan Limited ('GO' or 'the Company') benefits from a strategic partnership with Aramco, which acquired a ~40% stake in the Company. Aramco, a globally significant player in the energy and chemicals sector. This partnership reinforces GO's expanding footprint and strengthening market position within Pakistan's OMC sector. The sponsors are financially stable and possess extensive expertise across the energy supply chain. GO's operational infrastructure reinforces its competitive positioning. The Company maintains a retail network of ~1,329 stations, including ~80 COCO sites. Critically, GO holds the second-largest storage capacity in the sector at ~205,038 MTs, a strategic asset that enhances supply reliability, supports working capital efficiency, and provides a meaningful buffer against procurement and logistics disruptions. Operations span the full POL value chain, procurement, storage, distribution, and marketing — with sourcing across both domestic and international channels. Ancillary hospitality income from retail sites provides an additional, albeit modest, revenue stream.
GO's topline trajectory in CY25 was compelling. Net revenue surged ~89% YoY to PKR 619.6bln (CY24: PKR 327.8bln), driven primarily by volumetric expansion that has firmly established the Company among the top-tier OMCs by both sales volume and retail presence. Despite a decline in margins across all levels, profitability improved on the back of strong sales growth, with scale effects offsetting underlying cost pressures. The Company’s financial risk profile remains stable, underpinned by strong cash flows and high leveraged capital structure. The Company’s 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 met through conventional means, and now a new stream of commercial borrowing has been added. A substantial supplier credit extended by Aramco provides an additional cushion. Notwithstanding the significant supply chain disruptions stemming from the US-Iran conflict and the effective closure of the Strait of Hormuz, GO's topline and volumetric growth have demonstrated commendable resilience, supported by the Company's robust storage infrastructure and disciplined procurement practices.
The ratings are dependent on the Company’s ability to sustain its business profile, while maintaining the profitability matrix at optimal level. The sustainability of margins and improvement in coverages while expanding business volumes remain critical. Adherence to the debt matrix at a adequate level is a prerequisite for assigned ratings

About the Entity
Gas & Oil Pakistan Limited ('GO' or 'the Company') was incorporated as a public unlisted company in 2012 under the repealed Companies Act 2017. The Company obtained the license to operate as an OMC across Pakistan from OGRA in 2019. GO is engaged in POL procurement from the local and international markets and the storage, distribution, and marketing of petroleum products and lubricants. The Company has a ten-member Board; four members represent Aramco, and the other six are nominated by GO. Mr. Shahid Mehmood Khan chairs the Board, while Mr. Khalid Riaz heads the Company as the CEO. To enhance transparency, a few prominent management positions are appointed by Aramco. Other members of the Board and the management are also seasoned professionals.