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Business Recorder
15-05-2025
- Business
- Business Recorder
7 Pakistani cos added to MSCI FM & SC Indexes
KARACHI: Morgan Stanley Capital International (MSCI) has added seven Pakistani companies to its Frontier Market (FM) and Small Cap Indexes in its latest semi-annual index review, boosting the country's global equity market visibility. Morgan Stanley Capital International (MSCI) is a global research, data, and technology company that provides indices, research, and other services to investors worldwide. As per details cited by Topline Research, the minimum threshold for free float and total market capitalization for selection in the Frontier Market Index was set at $78 million and $155 million, respectively. Three Pakistani companies — Fauji Cement Company, DG Khan Cement Company, and Maple Leaf Cement — have been added to the MSCI Frontier Markets Index, effective from May 30, 2025. This brings the total number of Pakistani companies in the index to 26. Pakistan's weight in the MSCI Frontier Market Index is estimated to be around 6-6.5%, with the addition of the three cement companies expected to attract inflows of $5-8 million, assuming $2-3 billion in funds tracking the index globally. In the Small Cap Index, four Pakistani stocks have been added: Archroma Pakistan, At-Tahur Limited, Engro Polymer & Chemicals, and Pakistan Reinsurance. DG Khan Cement has been moved to the main FM Index, while AGP Pharma and Agritech Limited have been deleted. Topline Research noted that Interloop, Searle Limited, and Abbott Laboratories have been retained in the index despite not meeting the $78 million free float threshold, thanks to the buffer rule. This rule allows for flexibility in index inclusion. The firm drew parallels with a similar past instance where TRG was retained despite not meeting the threshold, only to be removed in a subsequent review. The index review holds particular significance for Pakistan as it continues to rebuild investor confidence following its 2021 downgrade from Emerging Market to Frontier Market status. The inclusion is anticipated to attract moderate passive fund inflows and enhance the visibility of Pakistani equities among global frontier market investors. Copyright Business Recorder, 2025
Express Tribune
14-05-2025
- Business
- Express Tribune
Three cement firms join MSCI frontier index
Listen to article Morgan Stanley Capital International (MSCI) has included three Pakistani companies in its Frontier Market (FM) Index and four more in its FM Small Cap Index as part of the May 2025 index review. MSCI, a prominent global provider of investment decision support tools, announced the results of its May 2025 semi-annual index review, bringing major changes for Pakistan's listed companies in both the MSCI Frontier Markets Standard and Small Cap indices. The changes, effective after the close of trading on May 30, 2025, highlight increased representation of Pakistan in the global investment landscape, particularly in the cement sector. According to Arif Habib Limited (AHL), Pakistan's weight in the MSCI FM Index is now estimated at around 6.1%, reflecting growing investor interest and improving market performance. As per the review, three cement companies - Fauji Cement, Maple Leaf Cement and DG Khan Cement - have been added to the MSCI FM Standard Pakistan Index. With no deletions reported, the total number of Pakistani constituents in the standard index now rises to 26. This includes major blue-chip names such as UBL, Lucky Cement, OGDC, Engro, MCB Bank, HBL, FFC and now the three cement firms. Topline Securities, in its research note, estimated that the combined weight of the three added stocks was 26 basis points (bps) in the FM index. Given that global funds tracking the MSCI's Frontier Index amount to around $2-3 billion, Pakistan could attract an estimated $5-8 million in passive inflows through these additions alone. Interestingly, DG Khan Cement's promotion comes at the cost of its removal from the MSCI Small Cap Index, highlighting its upgraded market status. Meanwhile, the small-cap index saw the addition of four companies – Archroma Pakistan, At-Tahur Limited, Engro Polymer & Chemicals and Pakistan Reinsurance Company. On the flip side, AGP Limited and Agritech Limited have been deleted from the MSCI Small Cap Index. The MSCI Small Cap Index now contains 410 constituents globally, with 67 stocks from Pakistan, making up roughly 16% of the total index and holding a 10.7% weight. Topline noted that companies like Interloop, Searle and Abbott Laboratories were retained in the index despite not meeting the minimum free-float threshold ($78 million in the latest review), citing the MSCI's buffer rule as the likely reason. This rule allows companies slightly below the threshold to remain in the index to minimise excessive churn. The inclusion criteria for this review were stricter compared to the previous one in February 2025, with the minimum free-float market cap raised to $78 million from $72 million, and the total market cap requirement up to $155 million from $145 million. Maaz Azam, Head of Research at Optimus Capital, told The Express Tribune that while the latest MSCI index review brings positive news, the true success for Pakistan will lie in re-entering the emerging markets (EM) category. The MSCI index changes are widely watched by institutional investors and passive fund managers around the world. The increase in Pakistan's representation may not only lead to short-term capital inflows but also signal growing confidence in the country's economic and market fundamentals.
Business Recorder
14-05-2025
- Business
- Business Recorder
MSCI adds 3 Pakistani cos to Frontier Market Index, 4 to FM Small Cap Index
Morgan Stanley Capital International (MSCI) Inc., a leading provider of critical decision support tools and services, announced the addition of three Pakistani companies as constituents on its Frontier Market (FM) and four companies in its FM Small Cap Index as part of its May 2025 index review. Meanwhile, three Pakistani companies have been removed from its FM Small Cap Index. In the MSCI Frontier Markets Indexes, three Pakistani companies have been added, stated MSCI in the note. These companies include Fauji Cement Co, DG Khan Cement Co and Maple Leaf Cement. These changes are to take effect from the close of May 30, 2025. 'This takes the total number of constituents in the MSCI Frontier Index to 26 from 23 earlier,' said Topline Securities in its note on the review. 'We estimate Pakistan's weight in the MSCI Frontier Market Index is close to 6-6.5%,' it added. MSCI adds 8 Pakistani companies to Small Cap, removes TRG Pakistan from Frontier Markets Indexes Topline said that the addition of three cement companies constitutes a weight of 26 basis points (bps). 'Assuming $2-3 billion funds tracking frontier market index globally, the inflows in these companies are estimated around $5-8 million,' it said. The brokerage house noted that the minimum threshold of free float and total market cap for the selection of frontier market stocks was $78 million and $155 million, respectively. Topline also highlighted that Interloop, Searle Limited and Abbott Laboratories are retained in the index despite not meeting the free float threshold of $78 million based on the buffer rule. Meanwhile, four Pakistani securities were added to MSCI Frontier Markets Small Cap Indexes, including Archroma Pakistan, At-Tahur, Engro Polymer & Chemicals and Pakistan Reinsurance. While one stock is moved to the main index, i.e. DG Khan Cement Co, and two are deleted, namely AGP Pharma and Agritech Limited. In September 2021, Pakistan was downgraded from its status as an emerging market, a little over four years after it was reclassified from the Frontier Markets (FM) Index by MSCI.
Express Tribune
16-02-2025
- Business
- Express Tribune
PSX recovers with gains of 1,762 points
Listen to article KARACHI: Pakistan's stock market closed on a positive note in the outgoing week, where the KSE-100 index gained 1,762 points, or 1.6%, compared to the previous week and settled at 112,085. Investor sentiment improved as Pakistan successfully met three out of the five key fiscal conditions set by the International Monetary Fund (IMF) for the first review of its $7 billion programme, according to media reports. Additionally, the MSCI announced changes to its global indices, with Pakistan's weight in the Frontier Market (FM) Standard Index being estimated at around 5.89%. Economic indicators reflected mixed trends. Auto sales surged 65% month-on-month (MoM) to 17,010 units while remittances for January reached $3 billion, marking a 25% year-on-year (YoY) increase. However, the State Bank of Pakistan's (SBP) foreign exchange reserves dropped $252 million to $11.2 billion. In the fixed-income market, the government raised Rs454 billion in a Pakistan Investment Bond (PIB) auction, exceeding its Rs350 billion target, while cut-off yields dipped one to 25 basis points across various tenors. On the diplomatic front, the Turkish president visited Pakistan, reaffirming bilateral ties and envisioning a $5 billion trade target. Meanwhile, an IMF delegation arrived to conduct a Governance and Corruption Diagnostic Assessment and met the auditor general and the Federal Board of Revenue (FBR) to discuss audit transparency and tax digitalisation. Foreign investors remained net sellers as they offloaded $5.7 million worth of shares, primarily in cement and banking sectors. Trading activity picked up, with average volumes rising 21% week-on-week (WoW) to 525 million shares and average traded value increasing 28.5% to $97.6 million. Among other key developments, Barkat Frisian IPO was set to raise Rs1.23 billion and banks' investment in government securities reached Rs26 trillion. On a day-on-day basis, the PSX on Monday made a notable recovery in an earnings season rally as investors closely monitored progress on key IMF targets such as the primary budget surplus and provincial net revenue collection. The KSE-100 index settled at 111,378, up 1,055 points. On the second trading day, the bourse again closed bullish, where investors took encouragement from robust economic data, including a 25% YoY surge in remittances that reached $3 billion in January 2025. The index, after touching intra-day high of 1,855 points, settled at 113,010, an increase of 1,632 points. On Wednesday, the PSX experienced a volatile session, with the benchmark KSE-100 index showing a see-saw pattern throughout the day. Concerns about foreign debt repayments, the upcoming EU review of Pakistan's GSP+ status and rising political noise created a perfect storm, all contributing to a negative close. The index recorded a slight decline of 85 points. On the second last day, a range-bound session marked trading at the stock market as investor sentiment remained mixed in the corporate earnings season. Though the KSE-100 kicked off proceedings on a positive note, it posted a loss of 361 points to 112,564.08. On Friday, the index posted a decline of 478.78 points and settled at 112,085.30 – its third consecutive session in the red – as institutional profit-taking in blue-chip stocks and global market jitters weighed on market sentiment. Arif Habib Limited (AHL) wrote in its report that the stock market started on a positive note as Pakistan successfully met three out of the five key fiscal conditions set by the IMF for the first review. Meanwhile, the MSCI announced changes to its global indices, with Pakistan's weight in the FM Standard Index expected to be around 5.89%. During the week, a PIB auction was held in which the SBP raised Rs454 billion and cut-off yields across various tenors declined one to 25 basis points. Pakistani rupee closed at Rs279.21 against the US dollar, appreciating Rs0.16, or 0.06% WoW, it said. Sector-wise, positive contribution came from cement (975 points), fertiliser (532 points), power generation and distribution (156 points), oil and gas marketing companies (145 points) and miscellaneous (106 points). Stock-wise, positive contributors were Lucky Cement (856 points), Fauji Fertiliser Company (381 points), Hubco (206 points), Mari Petroleum (167 points) and Engro Fertilisers (153 points), AHL added. JS Global Deputy Head of Research Muhammad Waqas Ghani wrote that the KSE-100 showed recovery this week and average volumes increased 21% WoW to 525 million shares. Remittances data for January 2025 showed strong inflows, totaling $3 billion. "This represents a remarkable 25% YoY growth," he said.
