KARACHI: The Pakistan Telecommunication Company Limited (PTCL) has further deteriorated its financial position, with its accumulated losses exceeding Rs50.15 billion, following a net loss of Rs10.46 billion in FY2025. These latest results, reflected in the Annual Aggregate Report on State-Owned Enterprises (SOEs) for FY25, highlight the increasing challenges faced by the telecom giant.
PTCL Losses in FY2025 Deepen Financial Strain
PTCL’s balance sheet reflects growing stress as persistent losses erode financial stability. The company continues to operate in a highly competitive market while carrying a heavy debt load that restricts its strategic flexibility.
The broader Infrastructure and ICT sector also shows strain. Loss-making entities such as PTCL recorded an Operating Cost Recovery Ratio (OCRR) of 0.80, which means the company generates only Rs80 for every Rs100 spent on operations. This gap highlights serious sustainability concerns.
Debt Servicing Costs Outpace Operating Profit
However, the biggest challenge that PTCL is still grappling with is the rising finance costs. In the financial year 2025, the firm incurred finance costs of Rs36.55 billion, almost twice its operating profit of Rs20.1 billion.
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The more leverage a firm has, the tighter its liquidity position becomes. Any slip-up in revenues or an increase in interest rates can further weaken its solvency position.
The SOE report also mentions that the biggest threat that PTCL faces is credit risk. Unless the firm makes financial adjustments quickly, its debt levels are expected to continue rising faster than its ability to generate earnings.
$400 Million Telenor Acquisition Raises Forex Risk
PTCL’s acquisition of Telenor assets for $400 million has significantly reshaped its risk profile. The transaction relied on a dollar-denominated loan from the International Finance Corporation (IFC).
This structure exposes PTCL to currency volatility because its revenues remain largely rupee-based while debt obligations sit in US dollars. A depreciating rupee inflates repayment costs and increases financial strain.
Fiscal Implications for the Government
The federal government holds a majority stake in PTCL, which raises broader fiscal concerns. If PTCL struggles to service its dollar-based obligations due to exchange rate pressure, the financial impact could extend to the public sector.
