Sitara petroleum launches Rs4.8bn IPO to fund storage, retail and logistics expansion

The Securities and Exchange Commission of Pakistan (SECP) has approved the initial public offering (IPO) of Sitara Petroleum Service Limited (SPSL), paving the way for the Lahore-based fuel trader to raise up to Rs4.8 billion to finance expansion across its retail, storage and logistics operations.

According to the company’s prospectus, SPSL plans to offer a total of 279.9 million ordinary shares, representing 16.66 percent of its post-IPO paid-up capital. The offering includes 168 million shares available to the public, while 111.9 million shares have already been placed through a pre-IPO transaction.

The company has already secured approximately Rs1.66 billion through the pre-IPO placement at Rs14.85 per share. The remaining IPO portion is projected to generate up to Rs3.175 billion at the cap price, bringing total expected proceeds to nearly Rs4.83 billion.

The offering will be conducted through the book building mechanism with a floor price set at Rs13.50 per share and a price band of up to 40 percent, allowing the upper limit to reach Rs18.90. Under the allocation structure, around 75 percent of shares will be reserved for institutional investors and high-net-worth individuals, while the remaining 25 percent will be offered to retail investors at the strike price.

The book building phase is scheduled for May 4 and May 5, followed by public subscription on May 11 and May 12. Arif Habib Limited has been appointed as the lead manager and book runner for the transaction.

Proceeds from the IPO will be primarily directed toward building an oil storage terminal, expanding the company’s network of fuel stations and strengthening its logistics capacity through the addition of new tanker vehicles. The storage terminal project represents the largest share of planned spending, accounting for roughly 56 percent of total proceeds.

As part of its medium-term growth strategy, SPSL intends to expand its retail footprint to more than 100 fuel stations within the next two years and increase its tanker fleet to 370 vehicles by 2027. The company is also working to enhance storage capacity as it positions itself to transition into a full-scale oil marketing company in the coming years.

Financially, the company has posted significant growth momentum. Revenue surged to Rs121.9 billion in fiscal year 2025, up from Rs40.9 billion in fiscal year 2024, while profit after tax reached Rs3.25 billion. Net worth stood at Rs11.37 billion in the first half of fiscal year 2026, reflecting strengthening balance sheet capacity to support expansion.