FIRST ASIA SECURITIES
PakistanSri LankaPREV
EquitiesFixed Income
DATA AS OF 13 JUL 2026 · EOD

HUBC

Hub Power Company
POWER

LAST · PKR

222.78
−4.27 ▼ −1.88%
P/E 6.7× · YIELD 6.5% · ROE 21.1%

52W RANGE

130.13235.65
88% OF RANGE · YTD +5.0%
01 / HUBC — 1 YearAS OF 13 JUL 2026 · EOD
PERIOD 1Y · 250 SESSIONS▲
The Call
BUY+26%
280.00PKR · 12-MO
7.5× FY26E

Transition delivers; payout defended.

Risks to our view
02 /

FAS DESK · FIRST ASIA SECURITIES RESEARCH · 23 JUN 2026 · EOD

Cheap base-load, building a second act

  1. 01

    Buy, PKR 280 target: at 6.7× with a 21% ROE and a 6.5% yield, HUBC is priced as expiring take-or-pay capacity — ignoring the pivot underway.

  2. 02

    Thar coal, China-backed projects and downstream oil/EV stakes backfill the economics as legacy PPAs roll off.

  3. 03

    Cash conversion is the catalyst — power-sector receivables gate the dividend, so the IMF energy-reform path is the swing factor.

  4. 04

    At ~7.5× our FY26E EPS the target is PKR 280; you are paid 6.5% to wait for the re-rate.

Where we differ from the street
Street viewOur viewWe change our mind if
Returns step down as PPAs expire; terminal value is low.Thar coal and the diversification pipeline backfill the shed earnings; a transition, not a run-off.New projects slipping while base plants de-rate.
Circular debt strangles cash; the yield is not safe.HUBC has defended the payout through worse; a settlement underwrites it.A dividend cut or an equity call to fund capex.
EV/battery and downstream bets are capital sinks.Option value bought cheaply against a 6.7× core the market credits at zero.Sustained losses in the new verticals.

— FIRST ASIA SECURITIES RESEARCH · NOT INVESTMENT ADVICE