Karachi: Gammon Pakistan Limited, in its quarterly progress report for the first quarter ending September 30, 2026, disclosed the absence of new construction projects and operating revenue. The report, dated October 2, 2026, reflects the company's sustained efforts to navigate a challenging business environment.
According to the report, the management actively pursued potential business opportunities within both the public and private sectors. However, prevailing market conditions, including elevated input costs and cautious client spending, hindered the acquisition of new projects. Despite these challenges, the company remains committed to exploring collaborations and maintaining liaisons with prospective clients.
The construction and infrastructure sector faced significant hurdles over the quarter. The State Bank of Pakistan upheld the policy rate at 11.5 percent during its Monetary Policy Committee meetings in July and September 2026, aiming to steer inflation towards a medium-term target of 5-7 percent. Headline inflation showed a year-on-year increase from 9.2 percent in July to 11.1 percent in August, before easing to 10.3 percent in September. These shifts were attributed to pressures from food and energy prices, global commodity prices, and regional geopolitical developments.
The Federal Public Sector Development Programme (PSDP) for FY 2026-27 allocated approximately Rs. 1 trillion toward national development. However, the practical impact of these allocations is unfolding gradually. Fiscal priorities, higher financing costs, and delayed decision-making by clients continue to constrain project awards in the construction sector, limiting new opportunities for contractors.
Despite the challenging environment, Gammon Pakistan Limited maintained its focus on business development. The management engaged with government departments and private sector clients, assessing potential projects based on commercial viability and effective risk management. Efforts were also directed toward resolving outstanding contractual matters and positioning the company for future opportunities.
According to information available from the Pakistan Stock Exchange (PSX), the company exercised stringent financial discipline during the quarter. Administrative and operational expenditures were tightly controlled to preserve liquidity. The management also worked on recovering outstanding receivables and retention monies related to completed projects, aiming to bolster the company's financial standing.
As the construction sector continues to grapple with various economic challenges, Gammon Pakistan Limited remains poised to leverage future opportunities as market conditions improve.