The energy and logistics landscape in Pakistan is set for a major transformation as Sitara Petroleum Service Limited officially announces its plans to enter the capital markets through an Initial Public Offering. According to the recently released prospectus, the company aims to raise a significant capital sum of up to Rs 4.8 billion. This influx of equity is earmarked for a comprehensive expansion strategy that includes the development of sophisticated oil storage infrastructure, the widening of its fuel retail footprint, and a substantial increase in its logistics and tanker fleet capacity.
The structural details of the offering indicate that Sitara Petroleum is making 279.9 million ordinary shares available to the market, which represents approximately 16.66 percent of its post-IPO paid up capital. The distribution strategy is split between a pre-IPO placement of 111.9 million shares, which has already been concluded, and a public portion of 168 million shares. The market is now looking toward the upcoming book building phase scheduled for May 4 and 5, which will be followed by the general public subscription on May 11 and 12. With a floor price established at Rs 13.50 and a 40 percent price band allowing for a cap of Rs 18.90 per share, the offering is designed to attract both institutional giants and individual retail investors.
Arif Habib Limited is spearheading this transaction as the lead manager and book runner, underscoring the institutional confidence in the company’s business model. Sitara Petroleum has already demonstrated its fund raising capability by securing roughly Rs 1.66 billion through its pre-IPO transaction at a price of Rs 14.85 per share. Should the public offering hit the upper price cap, it is expected to generate an additional Rs 3.175 billion, bringing the total proceeds to nearly Rs 4.83 billion. This capital injection is vital for the company’s long term vision of evolving from a service provider into a full scale Oil Marketing Company.
A deeper look at the utilization of these funds reveals a strategic focus on infrastructure. Approximately 56 percent of the total IPO proceeds will be funneled into the development of an oil storage terminal. This is a critical move intended to enhance the company’s operational independence and supply chain security. Furthermore, the Lahore headquartered firm plans to expand its retail network from the current 61 outlets to over 100 within the next two years. On the logistics front, the goal is to increase the tanker fleet from 320 to 370 vehicles by 2027, further solidifying its partnership with Gas and Oil Pakistan and increasing overall distribution efficiency.
The financial health of Sitara Petroleum serves as a strong foundation for this public debut. The company reported a massive revenue surge to Rs 121.9 billion in fiscal year 2025, a significant jump from the Rs 40.9 billion recorded the previous year. Profit after tax has reached a robust Rs 3.25 billion, with the company’s net worth standing at over Rs 11 billion by the first half of fiscal year 2026. Chief Executive Officer Zaheer Baig has emphasized that this IPO is a transformative step that will allow the business to integrate its energy services and enhance long term shareholder value through structural efficiency.
Shahid Ali Habib, the CEO of Arif Habib Limited, noted that this offering is a sign of a maturing capital market in Pakistan. He highlighted that growth oriented companies are increasingly looking toward equity financing as a sustainable way to fund large scale infrastructure projects. For investors, the Sitara Petroleum IPO offers a rare opportunity to participate in the growth of an integrated energy and logistics player at a time when the national demand for documented and efficient energy distribution is on the rise. As the May deadlines approach, the market remains optimistic about the impact this listing will have on the broader energy sector and the Pakistan Stock Exchange.
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