Listed Companies to Benefit from Latest Cut in Electricity Prices

Listed companies that rely heavily on the grid will significantly benefit from the federal government’s latest relief in electricity tariff cuts across all categories of consumers. According to JS Global, this development is a strong positive for cyclical stocks that rely heavily on grid power. In a major relief to the industrial sector, Prime Minister Shehbaz Sharif on Thursday announced a substantial reduction in the electricity tariff by Rs. 7.59 per kilowatt-hour (kWh) for industrial consumers. The move is aimed at encouraging greater energy consumption from the national grid while also improving the profitability outlook for power-intensive industries. Within the JS Universe, Amreli Steels Limited (ASTL) is expected to emerge as the top beneficiary, given its more than 90 percent dependence on the national grid. The tariff cut is expected to ease operational costs for ASTL, providing much-needed support amid ongoing economic headwinds. Mughal Iron & Steel Industries (MUGHAL) is likely to see a limited impact, as the company is close to commissioning its own coal-based power plant by the end of the next quarter. Among cement manufacturers, Fauji Cement Company Limited (FCCL) and Kohat Cement Company Limited (KOHC) are also expected to benefit significantly, with an annualized earnings per share (EPS) boost of 9.1 percent and 5.2 percent, respectively. Attock Cement Pakistan Limited (ACPL) is forecasted to see a positive earnings impact of 8.6 percent. However, other cement producers are projected to experience minimal gains due to their lower reliance on the national grid and greater dependence on internal power generation.