PACRA Maintains Entity Ratings of Hub Power Holdings Limited

The ratings of Hub Power Holdings Ltd. ("HPHL" or "the Company") reflect its position as an investment holding company, underpinned by its strong association with its parent, The Hub Power Company Limited (HUBCO) which provides strategic direction, governance oversight, and financial strength. The Company benefits from an experienced board and a centralized decision-making framework, particularly for evaluating and approving new investments. HPHL's portfolio includes significant stakes in key associated companies: approximately 47.5% in China Power Hub Generation Company (Private) Limited (CPHGC), which operates a 1,320 MW coal-fired power plant in Hub, Balochistan; approximately 38.3% in ThalNova Power Thar (Private) Limited, which operates a 330 MW coal-fired power plant; a 49% stake in China Power Hub Operating Company (Private) Limited, a joint venture responsible for operations and maintenance of the China Power plant; and a 50:50 joint venture with Prime International Oil and Gas Company Limited focused on acquiring renewable energy and upstream assets. HPHL's financial performance is primarily driven by dividend income and its share of profits from associates and joint ventures, with CPHGC serving as the dominant contributor to earnings on account of its stable capacity payments and operational maturity. The Company's investment portfolio is complemented by a strategic diversification into synergistic sectors. HPHL holds a 50% equity stake in Mega Motor Company (Private) Limited (MMCPL), established in partnership with BYD Auto Industry Company Limited to develop and market electric vehicles in Pakistan. MMCPL is currently developing a greenfield CKD assembly plant in Gharo, Sindh, with an estimated project cost of USD 150 million, structured on a 60:40 debt-to-equity basis and an annual production capacity of 25,000 units. Financial close for the project was successfully achieved in January 2026, with commercial operations expected to commence in the second half of 2026. As of December 31, 2025, HPHL's investment in MMCPL stood at PKR 8.8 billion. Additionally, HUBCO Green (Private) Limited (HGPL), a wholly owned subsidiary, is focused on developing and operating electric vehicle (EV) charging infrastructure, with 16 operational DC chargers currently installed at various Oil Marketing Company retail outlets, alongside plans to expand the network further. The Company also holds a stake in Ark Metals (Private) Limited, focused on mining and quarrying operations, further broadening its investment base beyond traditional power generation. HPHL's financial profile strengthened materially during 6MFY26, with the Company achieving a debt-free long-term balance sheet. This deleveraging was supported by robust dividend receipts of approximately PKR 36.08 billion during the period, primarily from CPHGC, which facilitated the complete extinguishment of outstanding long-term debt obligations, reflecting prudent and effective liability management. Finance costs declined sharply to PKR 14 million in 6MFY26, compared to PKR 938 million in the corresponding period of the prior year, reflecting the significant improvement in the Company's debt coverage metrics. The Company's share of profit from associates and joint ventures for 6MFY26 amounted to PKR 21.3 billion, with CPHGC contributing PKR 17.7 billion, representing approximately 84% of total income. On an unconsolidated basis, the Company reported a net profit of PKR 16.7 billion for the period, with total equity expanding to PKR 151.1 billion.
The rating is primarily supported by HPHL's strong backing through HUBCO, which ensures strategic oversight and stability, alongside a robust and diversified investment portfolio. The ratings remain contingent on the timely materialization of projected timelines and the generation of anticipated cashflows from the Company's expanding portfolio.

About the Entity
Hub Power Holdings Limited was incorporated in March 2015 as a public unlisted company in accordance with the Companies Ordinance, 1984 (currently governed by the Companies Act, 2017), as a wholly owned subsidiary of The Hub Power Company Limited. The Company primarily operates as the investment arm of HUBCO, focusing on strategic investments across energy, automotive, and resource sectors. The Board of Directors is chaired by Mr. Aly Khan, while Mr. Kamran Kamal leads the company as Chief Executive Officer.