KARACHI: The Securities and Exchange Company of Pakistan (SECP) on Friday said it will encourage listing of a company’s securities on an exchange through initial public offering (IPO), which means the first allocation of newly issued shares and debt, to the public.
This is because companies with a good track record, credible sponsors, experienced management and operations in a strong industry can easily tap capital markets for the generation of resources required for growth.
For the last couple of years, the SECP has assumed a more vigilant role and has also forced Pakistan Stock Exchange (PSX) to play its due role in promoting quality listings.
To promote ease of doing business, the SECP has also expedited its approval processing time and as a matter of fact, the SECP approved the last three IPO applications within five working days after receipt of complete applications.
Being the front line regulator, PSX has the prime responsibility to promote quality listing considering the interest of all the stakeholders including general public and the issuers. In order to strengthen its prospectus approval process, the PSX has recently constituted a listing committee comprising of independent market participants, professionals with business background and members of its management.
After its constitution, the said PSX committee has approved first prospectus for listing of a company, which is one of those companies which participated in the interactive session organised jointly by PSX and the SECP.
It is imperative to encourage new quality listings to complement a sustainable growth being registered by our capital markets and to maintain investors’ confidence.
Public offering process starts with the decision of the sponsors of the company to offer securities to the general public. In this connection, PSX and the SECP jointly held various interactive sessions in different cities with the selected group of sponsors having high potential for listing.
These sessions provided a unique opportunity to sponsors to interact with different segments of capital market service providers, including PSX, regulator, brokerage firms and sponsors of recently listed companies and to explain the pathways to a successful listing.
Published in The Express Tribune, December 31st, 2016.