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More initial public offerings likely in 2022

More initial public offerings likely in 2022

More initial public offerings likely in 2022

Image Courtesy: File

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KARACHI: If the macroeconomic situation in Pakistan stabilises after the resumption of the International Monetary Fund (IMF) programme, there will be more initial public offerings in 2022.

“Though, there are a few IPOs [initial public offerings] in [the] pipeline, as companies plan to expand their capacities, the outlook on IPOs will depend on the overall economic and market conditions in 2022,” Topline Securities CEO Muhammad Sohail said.

Pakistan’s record run of initial public offerings is expected to gather pace in the coming months, as more companies rush to raise funds, amid the economic recovery.

The stock exchange is also working on a plan that will enable trading in sovereign bonds by the end of the year. Index trading, derivatives or options trading will be launched between January-June 2022 after consultation with the market players.

The Pakistani market saw record offerings in 2021 where the bourse witnessed eight IPOs, including two GEM Board offerings, highest after 2015.

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The total amount raised from the investors from the eight offerings clocked-in at Rs20 billion in 2021. In 2015, there were eight offerings, as a total of Rs116 billion was raised through primary and secondary offerings, including the secondary offering of Habib Bank Limited (HBL) by the government of Pakistan, which alone raised Rs102 billion.

The market saw immense enthusiasm in these offerings during the year, as all of them were oversubscribed.

Among all these listings, Octopus Digital (OCTOPUS) posted the highest return of 46 per cent since its listing; followed by Citi Pharma Limited (CPHL), which posted a return of 5 per cent.

However, Pakistan Pak Agro (GEMPAPL) and Panther Tyres (PTL) posted a decline of 35 per cent and 33 per cent, respectively.

Interestingly, these offerings saw huge investors’ interest, despite dull performance by the KSE-100 index, which saw 2 per cent decline in the rupee terms and 12 per cent in the dollar terms in 2021 to-date.

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