Lesco plans 300% jump in authorised capital to Rs200 billion

Lahore Electric Supply Company has proposed a 300% increase in its authorised share capital to Rs200 billion from the existing Rs50 billion, as part of steps to align its capital structure with the federal government’s growing equity stake in the company, Business Recorder reported, citing sources. 

The proposal will be placed before Lesco’s general body at its Annual General Meeting scheduled for February 6, 2026, where shareholders will consider a special resolution to enhance the authorised capital. Under the proposal, the authorised share capital would be divided into 20 billion ordinary shares of Rs10 each, carrying rights, privileges and conditions as determined by the company in accordance with applicable laws.

Company officials said the increase has become necessary due to the rise in government equity reflected as deposits for shares, which stood at Rs149.51 billion as of June 30, 2025. Following approval, Clause V of Lesco’s Memorandum of Association will be amended to reflect the revised authorised capital.

The amended clause will also empower the company to increase or reduce capital, create different classes of shares and attach or modify rights, privileges and conditions, while maintaining proportional rights among ordinary shares based on paid-up value.

For voting at the AGM, Lesco has sought a proxy under Article 45 of its Articles of Association for 673.8 million shares registered in the name of the President of Pakistan. The proxy will be granted in favour of either Lesco Chief Executive Officer Muhammad Ramzan or Board Chairman Amer Zia to exercise voting rights on behalf of the government.

The increase in government equity traces back to circular debt settlement arrangements. In June 2013, the Finance Division transferred Rs341.96 billion to Pakistan Electric Power Company for payment of power sector liabilities. Of this, Rs37.97 billion was allocated to Lesco, with CPPA-G issuing credit advice treating the amount as government equity.

Further adjustments were made in subsequent years. During the year ended June 2019, Rs886 million was allocated to Lesco against markup payments on loans raised for circular debt settlement, again treated as government investment through CPPA-G debit advice.

The deposit for shares has grown steadily over time, rising from Rs103.63 billion last year to Rs149.51 billion by end-June 2025. During FY25 alone, CPPA-G issued credit note advices of Rs45.88 billion to Lesco as adjustments on account of government equity, prompting the need to revise the company’s authorised capital.

The chief executive officer and company secretary will be authorised to complete all legal and corporate formalities, including filings with the Securities and Exchange Commission of Pakistan and the Registrar of Companies, to implement the resolutions.