KARACHI, October 26 2024: In a remarkable turnaround for Pakistan’s capital markets, 2024 has witnessed a substantial revival in Initial Public Offerings (IPOs), with five companies raising a total of PKR 8 billion. This resurgence has been fueled by a favourable economic environment and robust Pakistan Stock Exchange (PSX) performance.
The positive macroeconomic indicators including a declining inflation rate, monetary easing, and a stable currency combined with the successful negotiation of a USD 7 billion Extended Funding Facility from the IMF, have significantly bolstered investor confidence. As a result, the KSE-100 Index has surged by an impressive 42.4% year-to-date, with corporate profitability soaring to a historic PKR 1.6 trillion, marking a 24.4% increase during FY24.
This vibrant market atmosphere has prompted companies to capitalize on public equity offerings. In 2024, the PSX welcomed new listings from Secure Logistics (SLGL), TPL REIT Fund-I (TPLRF1), International Packaging (IPAK), Fast Cables (FCL), and BF Biosciences (BFBIO). Additionally, the Growth Enterprise Market (GEM) board saw the inclusion of Mughal Energy (GEMMEL) and Burj Clean Energy (GEMBCEM).
The total demand for IPOs this year reached PKR 13 billion, reflecting strong investor interest, with a remarkable oversubscription rate of 1.6x. This appetite for equity has made 2024 the highest year for capital raised via IPOs since 2021.
Beyond IPOs, the equity market also saw 10 companies issuing rights shares, collectively raising PKR 18.3 billion, indicating ongoing demand for capital expansion across various sectors. Furthermore, the PSX experienced four mergers this year, up from three in the previous year, with notable entities such as Stylers International and Big Bird Foods joining the market.
As 2024 continues, the outlook for Pakistan’s equity market remains optimistic, with investors and companies alike poised to take advantage of the burgeoning opportunities.
