KSE-100 index witnesses increase of 1.53% during FY20 despite COVID-19: Report

Despite lockdown across the country as well as the whole world due to COVID-19, the KSE-100 index witnessed an increase of 1.53 percent during the fiscal year 2019-20 as it began the year at 33,901.58 points and ended at 34,421.92 on June 30, 2020, according to the Security and Exchange Commission of Pakistan (SECP) Annual Report.

As per annual report, a total of 530 companies with paid-up capital of Rs1,391.477 billion were listed on Pakistan Stock Exchange (PSX) as on June 30, 2020.

On June 30, 2020, the market capitalization was Rs6,529.707 billion was 5.19 percent lower than June 30, 2019 market capitalization of Rs6,887 billion.

In the beginning of FY 2019-20, the KSE-100 witnessed a declining trend, however, positive recovery was witnessed towards the end of financial year.

During the year, KSE 100 touched its lowest level of 27,228.80 on March 25, 2020 and highest level of 43,218.67 on January 13, 2020.

Average daily turnover in ready and future markets was Rs196.364 million shares and Rs79.277 million shares, respectively.

Similarly the foreign investment in the stock market exhibited a net outflow of $284.832 million during the FY 2019-2020, however, it was 20% lower to the net outflows of $ 356.04 million observed in the FY 2018-2019.

In Pakistan, the first case of COVID-19 was reported in February, 2020. The virus spread into various regions nationwide and was officially classified as epidemic situation in March 2020, in response, the authorities decided to impose lock down across the country and all the industrial and retail sectors were affected by this lock down, the report added.

It said the stock market, resultantly started to decline due to this uncertain situation.

With the increased number of infected cases reported in Pakistan, the stock market suddenly lost its momentum and panic like situation was witnessed in the market.

Foreign investors withdrew their portfolio investments and investors started to offload their holding. During the month of March, eight downward market halts were triggered.

However, despite all the turbulence and uncertainty, market operations were never halted even for a single day and settlements were executed smoothly in a timely manner that depicts strength and resilience of capital market in Pakistan.

During the FY 2019-20, no new company was listed as compared to two companies in FY 2018-19 primarily owing to the Covid-19 pandemic. However, SECP granted approvals to two new companies i.e.

Organic Meat Company Limited on April 17, 2020 and TPL Trakker Limited on May 14, 2020 to raise capital from the general public, which were subsequently listed at PSX.

These companies offered their share capital to the general public through an Initial Public Offer (IPO).

The public subscription for Organic Meat Company Limited and TPL Trakker Limited took place on July 14 to July 16, 2020 and July 22 to July 23, 2020, respectively.