Pak Elektron Limited (PSX: PAEL) has expanded into new markets, mainly the United States, securing export orders worth $44 million with a target of $50 million by end-2025.
It has also secured orders from global leaders such as Tesla, showcasing its engineering strength and competitiveness in international energy solutions, according to a report by Topline Securities. The brokerage house said that it has a recent meeting with the senior management of Pak Elektron CFO, Manzar Hasan and GM Finance, Nadeem Asghar on the recent financial results and outlook.
The company has supplied 20-25% of the export order in 1H, while in 2H rest of the orders will be supplied.
In absolute terms, PAEL has supplied $9 million till June 2025, while till August 2025, company has supplied a total of $16 million. The company expects completion of this whole order book ($40-44 million) by December 2025.
Regarding expanding the capacity of transformer business, the company is awaiting to receive its US certification, which will enable company to target government owned companies in US. As of now, they are entitled to sell to private customer(s). This certification will further accelerate export growth.
On the recent US tariff front, the complete 19% tariff on Pakistan is borne by the customers as tariffs on Pakistan remain lower than competing countries like Bangladesh and India. PAEL also benefits from significantly shorter delivery times compared to US manufacturers (9 months vs. 2 years).
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There are some countries with lower tariff like UAE and Turkey (at 10%), however, they are not major transformers exporters to USA. The major exporters to US are China, India, and Korea. Pakistan has edge over these players.
PAEL meter business is expected to grow 2-3x next year (from Rs. 4.5 billion to Rs. 9 billion) as all DISCOS are now required to change existing simple single-phase meters to Two Phase AMR and 3 Phase AMR. There are around 8 competitors in this line of business and PAEL holds 20% market share. The margins in this business are also decent.
The company is in distribution agreement with Electrolux and sales for this year from this is Rs. 2 billion. While Panasonic sales are Rs. 1.5 billion.
The company has taken slow start in these brands as penetration of premium brands in Pakistan takes some time. Company assembles Electrolux products in their own factory and is entitled to use brand name of Electrolux.
The company is expecting overall sales growth of over 30% for 2025. Despite this high growth, the actual projected volumes (quantity) of 2025 would still be around 25% lower than peak achieved in last few years (i.e. 2021).
In 2Q2025, margins improved QoQ from 26% in 102025 to 27.7% in 202025, mainly due to higher volumes. Out of 2,600 total appliance dealers in Pakistan, PAEL has 1,513 dealers all over Pakistan.
The household appliance market in Pakistan is valued at Rs. 328.6 billion ($1.2 billion). PAEL holds a 19% market share in refrigerators, 9% in air conditioners, 4% in washing machines, and 25% in water dispensers. In the power segment, PAEL holds a 90% share in the Rs. 16 billion power transformer market, 17% in the Rs. 41 billion distribution transformer market, 25% in the Rs. 17 billion MV & LV switchgear market, and 18% in the Rs. 20 billion energy meter market.
