Dandot Cement Company Limited (DNCC) has proposed converting approximately Rs2.47 billion in related-party loans into equity, a move aimed at strengthening its balance sheet and potentially improving earnings per share, subject to shareholder approval.

According to a notice filed with the Pakistan Stock Exchange, the company’s board has approved a plan under Section 83 of the Companies Act, 2017 to convert outstanding loans from three related entities into ordinary shares.

The proposal will be placed before shareholders at an Extraordinary General Meeting scheduled for June 24, 2026.

The total amount includes Rs735 million owed to Digital World Pakistan (Private) Limited, Rs210 million to Tetra Engineering (Private) Limited, and Rs1.529 billion to Calicom Industries (Private) Limited.

If approved, DNCC plans to issue up to 121 million ordinary shares in exchange for these liabilities, including 37 million shares for Digital World Pakistan, 8.4 million for Tetra Engineering, and 76 million for Calicom Industries.

Analysts cited in market reports suggest the transaction could improve the company’s financial structure and support earnings metrics, as the converted loans are interest-free and would not add to finance costs.

The share pricing structure varies by lender, with some shares issued at a premium linked to market prices, while others are priced above par value.

The company has also authorized management to obtain necessary regulatory approvals from the Securities and Exchange Commission of Pakistan (SECP) and complete all formalities required for implementation, subject to shareholder consent.