DEL Engineering Domestic (Pvt.) Limited (DEDL), a subsidiary of the Descon Group (Descon), is part of a leading Pakistani multinational conglomerate headquartered in Lahore. Descon’s diverse expertise spans EPC, construction, maintenance and industrial services, infrastructure development, manufacturing, and automation and control projects. With a global footprint covering the GCC region (Saudi Arabia, UAE, Kuwait, Qatar, Oman), Iraq, Pakistan, and South Africa, Descon operates across various industries including Engineering, Construction, Chemicals, Power and Agriculture. The flagship entity, Descon Engineering Limited (DEL), specializes in Engineering, Procurement, and Construction (EPC) activities in Pakistan. Its Chemicals division includes Descon Oxychem Limited, while its Power division, managed by Descon Power Solutions (DPS), provides operations and maintenance (O&M) services for thermal and renewable power plants in Pakistan.

The primary objective of DEDL is to oversee and manage its strategic investments in foreign subsidiaries and associates, which are involved in a diverse range of industries. These include: i) Fabrication and manufacturing of industrial equipment ii) Mechanical and electrical construction iii) Maintenance services for the oil and gas sector iv) Onshore and offshore services related to oil and gas fields and facilities v) Engineering and construction services specifically tailored to the oil and gas industry vi) Import, export, and trading of industrial machinery. DEDL focuses on effectively managing these investments to support and grow its operations across these key sectors.

DEDL is entirely owned by the Abdul Razak Dawood family (ARD Family). The ownership structure of DEDL is primarily controlled by Abdul Razak Dawood, who holds approximately 94.27% of the Company’s shares, making him the majority stakeholder. His significant shareholding underlines his central role in guiding the Company's strategic direction and operations. The remaining equity is distributed among other family members, Bilquis Dawood holds approximately 2.86% of the Company's equity, while the sons Mr. Taimur Dawood and Mr. Faisal Dawood each holding around 1.15% of the shares., and the remaining portion, about 0.57%, is owned by daughter Ms. Mehreen Dawood.

The family-driven ownership structure ensures that the ARD Family maintains control over DEDL, with decisions and management strategies deeply influenced by their vision and values. The close-knit ownership base also allows for a unified approach to business strategy and long-term goals, providing the Company with the stability and cohesion needed to pursue its growth objectives and manage its diverse portfolio of investments. Ownership of the business is seen as stable as its shareholding vests with the sponsors (ARD Family) and its holding company structure.

The Descon Group, originally founded in Pakistan, has significantly expanded its operations beyond its home country, establishing a strong presence in key international markets, including Abu Dhabi, Saudi Arabia, Qatar, Oman, and Egypt. The group has developed specialized knowledge and experience in sectors such as Oil & Gas, Cement, Power, Hydropower, Dams, Barrages, and Canals, Fertilizer, Renewable Energy, Sugar, Industrial, and Chemical and Petrochemical industries. Through its commitment to innovation, quality, and operational excellence, Descon has earned a reputation for delivering large-scale, complex engineering solutions that meet the highest industry standards. Descon’s diverse portfolio and regional expansion reflect its strategic approach to growth and its ability to adapt to the evolving needs of various industries. With a strong focus on sustainability and technology, the group continues to play a pivotal role in driving development across the sectors it serves, both domestically and internationally.

The Group has consistently demonstrated its readiness and capability to provide support to its companies whenever needed, ensuring their stability and growth. As of FY24, DEDL holds a solid consolidated asset base of approximately PKR 86 billion, backed by an equity base of around PKR 48 billion. This marks an increase from FY23, where the asset base stood at approximately PKR 73 billion and equity at around PKR 42 billion. This growth reflects the Group’s continued financial strength and commitment to expanding its operations.

The overall governance of the Company is entrusted to a seven-member Board of Directors. Four of the board members are from the sponsoring family, including the Chairman, Mr. Taimur Dawood, and the Vice Chairman, Mr. Faisal Dawood. The remaining three members are non-executive directors.

The Board of Directors is led by Mr. Taimur Dawood, representing ARD family. Currently, Mr. Taimur also serves as Chairman of Descon; which includes Descon Engineering Limited, Descon Oxychem Limited and Descon Power Solutions (Pvt.) Limited among other Descon entities for the power sector. He is also the Managing Director of Gray Mackenzie Engineering Services BV, the Netherlands. He earned his Bachelor Degree in Industrial Engineering from Purdue University, USA and MBA from Columbia University, New York, USA. Prior to joining Descon, Taimur Dawood worked as an equity analyst at Graham Partners, a technology focused hedge fund. He also worked at UBS as a technology analyst. Taimur Dawood has over 20 years of work experience in a variety of fields that include product marketing, project finance, strategy development and implementation, turn around management, mergers and acquisitions. From 2001 to 2011, he successfully ran Descon Chemicals Limited as the Chief Executive Officer. In addition to being on the Board of Directors of various Descon Companies, Mr. Taimur is also a Board Member and chartered member of TIE (The Indus Entrepreneurs). He was also the former President of Young President Organization’s Indus Chapter. The other board members are highly qualified, with most holding degrees from prestigious foreign universities, and have been with the Company for a substantial period, ensuring continuity and strong leadership.

Although the Company is privately held, it adheres to the principles of corporate governance. The Board has established four key committees to enhance governance and oversight: i) Human Resource and Remuneration, ii) Audit, iii) Whistle Blowing Steering Committee, and iv) Corporate Risk Management Committee. Each committee is chaired by a board member and includes a mix of executive and non-executive members. The formation of these committees ensures comprehensive oversight and strengthens the Board's governance functions. To maintain strong monitoring and control, the Board holds monthly meetings with the management, facilitated by nominated board members. Prior to these meetings, Management Information System (MIS) reports are distributed to all Board members, allowing for in-depth discussions on key performance areas. This process contributes to the Board's overall effectiveness in guiding the Company’s strategic direction and ensuring robust governance practices.

Crowe – Hussain Chaudhury & Co., Chartered Accountants, is the external auditor of the Company. The auditor gave an unqualified opinion on the Company’s financial statements for the year ended June 30, 2023. The audit for FY24 is currently in progress.

DEDL has established a well-structured organizational framework, designed to streamline operations and enhance efficiency across its various functions. The Company is organized into distinct divisions and departments, each specializing in key areas critical to the business. These include Finance, Strategy, Information Systems, Internal Audit, Human Resources, Corporate Communication, Legal, and Public Affairs. Each department is led by a department head, who is responsible for overseeing the performance and strategic direction of their respective functions. These department heads report directly to the CEO, ensuring that the leadership team is well-informed and aligned with the Company’s overall goals and objectives. The CEO, in turn, provides updates and reports to the Board, ensuring effective governance and oversight.

Mr. Taimur Dawood serves as both the Chairman of the Board and the CEO of the Company, providing visionary leadership and strategic direction. Mr. Abdul Sohail holds the position of Chief Financial Officer (CFO), where he oversees the Company’s financial strategy and operations, ensuring the efficient management of financial resources to support long-term objectives. Mr. Mukarram, the Treasury Head, is responsible for managing the Company’s liquidity, investments, and financial risks, ensuring optimal financial stability. Together, this leadership team, supported by a highly skilled and experienced group of professionals, drives DEDL's commitment to operational excellence and strategic growth across the organization.

DEDL has successfully acquired and executed hundreds of projects for prominent blue-chip clients both domestically and internationally, establishing itself as a highly effective management team. The Company possesses all the essential capabilities required to deliver turnkey projects in-house. This unique strength positions DEDL as a leading provider of EPCC (Engineering, Procurement, Construction, and Commissioning) services, enabling it to offer comprehensive solutions to a wide range of international clients.

EPC and construction projects demand the highest standards of Quality, Health, Safety, and Environmental (QHSE) management. DEDL adheres to all applicable laws and industry standards to ensure compliance and operational excellence. The Company is certified with ISO 9001 (Quality Management), ISO 14001 (Environmental Management), and OHSAS 18001:2007 (Occupational Health and Safety), demonstrating its commitment to maintaining superior quality and safety standards across its operations.

The Company has two distinct teams at the group level responsible for investment decision-making: the Strategy team and the Treasury team. The Strategy team focuses on identifying and developing new ventures for the group companies, with the Head of Strategy reporting directly to the CEO. The Treasury team, on the other hand, manages the short-term investment portfolio, with the Head of Treasury reporting to the CFO. This structured approach ensures a strategic alignment of investment activities while maintaining effective oversight and execution.

The Company maintains a conservative short-term investment portfolio, primarily consisting of Term Deposit Receipts (TDRs) and mutual funds, ensuring stability and liquidity. Additionally, its equity portfolio is strategically diversified within the engineering sector, with investments spanning multiple key geographical regions, including the Kingdom of Saudi Arabia, UAE, Kuwait, Qatar, and Oman. The Company’s prudent investment strategy, balancing risk while capturing growth opportunities across prominent markets.

The Group’s investment team works closely with other companies within the Group, maintaining regular communication to stay informed about their performance. The team consolidates this information and presents comprehensive updates to the Board of Directors on a quarterly basis, ensuring that the Board remains well-informed and can make informed decisions based on the latest performance data across the Group.

The Company's equity investment portfolio is strategically diversified, primarily focused on the engineering sector, and spans multiple key geographical regions. These regions include the Kingdom of Saudi Arabia, UAE, Kuwait, Qatar, Oman and South Africa. This diversified approach allows the Company to reduce exposure to risks associated with any single market, while simultaneously leveraging growth opportunities across a range of dynamic and high-potential markets. By investing in these regions, the Company aims to strengthen its position in the engineering sector and enhance long-term value for its stakeholders.

The Company’s balance sheet reflects two distinct types of investments: Core Investments and Non-Strategic Investments. Core Investments consist solely of unlisted subsidiaries, representing long-term, strategic holdings that are integral to the Company’s operations and growth. Non-Strategic Investments, on the other hand, include short-term investments in TDRs, which are primarily aimed at maintaining liquidity and generating stable returns in the short run. This structured investment approach enables the company to balance long-term growth with short-term financial stability.

DEDL is focused on generating sustainable income streams, primarily through dividends from its business ventures. The Company’s standalone revenue largely consists of stable dividend income derived from its subsidiaries and associates. In FY24, total investment income experienced a slight decline, reaching approximately PKR 610 million, compared to PKR 658 million in FY23. Of this total income, approximately 58% is generated from foreign remittances, 39% from equity investments in the form of dividends, and the remaining portion comes from profits on short-term investments. Despite this income, the Company reported a net loss of PKR 20.6 million for FY24, primarily due to a significant increase in administrative costs. These costs rose to PKR 592 million in FY24, compared to PKR 1.7 million in FY23. This increase was largely driven by the shared costs of PKR 560 million, associated with its subsidiaries, reflecting the growing scale of operations and the associated expenses.

During FY24, the Company's Free Cash Flow from Operations (FCFO) turned negative due to a decline in profits, reaching PKR -284 million (FY23: PKR 509 million). As a result, the coverage ratio also dropped to -283.6x (FY23: 508.6x). Despite this, DEDL maintains a decent financial position, as it has no outstanding loans, bonds, or other financial obligations, which underscores its financial stability. The Company is not burdened by debt-related interest payments or principal repayments. Furthermore, DEDL has not relied on additional financial safeguards such as coverages or hedging instruments. The Company’s financial health and stability remain closely tied to the performance of its subsidiaries and the effective management of its investment portfolio.

DEDL maintains a zero-debt structure at the standalone level, ensuring that its subsidiaries are not burdened by individual financial obligations. This debt-free approach minimizes financial risk across the organization and enhances flexibility in resource management. With no debt reflected on its balance sheet, DEDL is in a decent financial position, particularly in managing its liabilities and financial risks. However, the Company’s financial exposures primarily stem from off-balance-sheet items, such as Letters of Guarantee and non-funded credit lines of its subsidiaries, which represent contingent financial obligations.

DEDL does not engage in significant operational activities that directly generate revenue. Instead, its primary role is to own and control its subsidiaries, which are responsible for driving revenue, conducting business operations, and contributing to the overall financial performance of the Company. It is essential for DEDL to actively monitor the financial performance of its subsidiaries, ensuring they positively contribute to the holding Company's overall value. This approach enhances financial control, risk management, and transparency, enabling DEDL to make informed strategic decisions and optimize its global operations. It represents a unique model for managing a global network of subsidiaries while maintaining financial stability at the holding Company level. As of the end of FY24, DEDL's consolidated revenue reached approximately PKR 89,683 million, reflecting a 36% growth compared to FY23 (PKR 65,930 million). However, operating margins decreased to 4.4% in FY24, down from 5.3% in FY23. The net consolidated profit increased by 3%, standing at PKR 6,790 million, compared to PKR 5,304 million in FY23. The Company's leverage remains minimal, with a ratio of approximately 6% in FY24, compared to 7.5% in FY23.