The Morgan Stanley Capital International (MSCI) has added three new Pakistani companies to its main Frontier Market Index, bringing the total number of domestic companies in the international index to 20 as of February 29, 2024, according to the latest quarterly indices review results on Tuesday.
Additionally, the global index analytics provider has added another 19 domestic companies to the MSCI Pakistan Frontier Market Small Cap Index and deleted four from the index after they no longer met the qualification criteria.
Following these adjustments, the total number of Pakistani companies in the country-specific index has risen to 56.
These developments are expected to attract foreign investment to the listed companies on the Pakistan Stock Exchange (PSX), thereby improving business sentiment and investor confidence in the domestic economy.
The quarterly review results apparently did not include an analysis of the potential impact of the recently emerged political uncertainty following the general elections held on February 8.
Topline Securities commented post-MSCI results, “After this review, Pakistan’s weight in the Index is expected to be around 3%. Due to this adjustment, we anticipate some net external investment flows, although the quantum will not be significant.”
The number of domestic companies surged in the global indices following their share price increases on the PSX in the recent past.
Read PSX rebounds on MSCI index review
To recall, the PSX benchmark index posted a return of 56% in the first half (Jun-Dec) of the current fiscal year 2023-24, reaching 62,451 points on December 29, 2023, emerging as one of the world’s best-performing markets in the half-year.
However, the market has remained under selling pressure since no single party won a clear majority mandate, suggesting the installation of a coalition government and a hung parliament in the country, which may face challenges in transitioning the domestic economy from the current stabilisation phase to the growth phase.
To highlight, Pakistan was reclassified to MSCI Frontier Market from Emerging Market in Nov 2021 as it did not meet the standards for size and liquidity, Topline added.
The three new Pakistani companies added to the MSCI Frontier Market Index include Bank AL Habib (BAHL), Interloop (ILP), and Sui Northern Gas Pipelines (SNGP).
The 19 additions to the Pakistan Frontier Market Small Cap index include Adamjee Insurance Company Limited, Agritech Limited, Aisha Steel Mills, Askari Bank Limited, Century Paper & Board Mills, Ferozsons Laboratories, Ghandhara Industries, Ghani Glass Limited, Hascol Petroleum Limited, IGI Holdings Limited, JS Bank Limited, Murree Brewery, Nishat (Chunian) Limited, Pakistan Cables Limited, Pakistan Stock Exchange, SG Fiber Limited, Sui Southern Gas Company, Treet Corporation, and Worldcall Telecom Limited.
The four deleted companies removed from the index include BankIslami Pakistan Limited, Fauji Cement Company Limited, Pak Suzuki Motor Company Limited, and Sui Northern Gas Pipelines Limited.
Published in The Express Tribune, February 14th, 2024.
Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.
1714129906-0/Clint-Eastwood-(1)1714129906-0-270x192.webp)
COMMENTS
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ