Despite showing revenue growth, PTCL Group seems to be headed down the same troubled path as Pakistan’s struggling state-owned enterprises like Pakistan Steel Mills, PIA, and Pakistan Railways, with mounting financial losses overshadowing increasing revenues.
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PTCL’s latest financial report revealed a 15.3% rise in revenue to Rs160.6 billion in the first nine months of this year compared to 2023, driven by growth in fixed broadband, mobile data, and business solutions. However, the telecom giant posted a net loss of Rs15.3 billion during this period, raising serious concerns about its financial health.
Since Etisalat took over PTCL’s management in 2006 after acquiring a 26% stake for $2.6 billion, the company’s financial trajectory has spiraled downward. While it reported a profit of Rs28 billion that year, the group has been on a continuous decline ever since, despite the government of Pakistan holding a 62% ownership stake.
PTCL’s loss trend is evident, with a net loss of Rs14.1 billion in 2023, despite Ufone’s strong performance and U Microfinance Bank’s impressive 76.5% revenue growth. Analysts blame PTCL’s struggles on high administrative and financial costs, which hover between 8% to 10% of its revenue.
Financial experts argue that PTCL is being managed like any other failing state-owned enterprise, where inefficiencies and poor financial strategies overshadow potential growth. Nasheed Malik, a financial analyst at Topline Securities, noted that the group’s continued mismanagement is likely to worsen after its planned acquisition of Telenor Pakistan, potentially adding to the financial strain.
As the telecom conglomerate struggles to stay afloat, many fear that PTCL may follow the fate of other state-owned entities if immediate action isn’t taken to address its operational inefficiencies and bloated costs.
