Home / Finance & Market / Pakistan stock exchange stays in the rank of best three exchanges in Asia; revenue grows 11pc in ninth months period

Pakistan stock exchange stays in the rank of best three exchanges in Asia; revenue grows 11pc in ninth months period

Published on 4th July, Edition 27-28, 2016

 

During the nine month period ended March 31, 2016, PSX continued to remain amongst major three best performing exchanges in Asia

COMPARATIVE MARKET PERFORMANCE
Details June 30. 2015 March 31, 2016 % change
Malaysia 1,707 1,718 0.6
Indonesia 4,911 4,845 -1.3
Pakistan 34,399 33,139 -3.7
Philippines 7,565 7,262 -4.0
Vietnam 593 561 -5.4
Brazil 22,029 20,659 -6.2
Thailand 1,505 1,408 -6.4
India 27,781 25,342 -8.8
MSCI EM 972 837 -13.9
MSCI FM 578 493 -14.6
Hong Kong 26,250 20,777 -20.9
China 4,277 3,004 -29.8

The Pakistan Stock Exchange (PSX) is the main stock exchange of Pakistan with trading offices in Karachi, Islamabad and Lahore. PSX was organized on January 11, 2016 after the merger of individual stock exchange’s of Lahore, Karachi and Islamabad.

PSX is part of the MSCI Emerging Markets Index. PSX’s origin’s where laid with the establishment of the Karachi Stock Exchange (KSE) in 1947, Lahore Stock Exchange (LSE) in 1970 and the Islamabad Stock Exchange (ISE) in 1992.

During the nine month period ended March 31, 2016, PSX continued to remain amongst major three best performing exchanges in Asia, even though in absolute terms the KSE-100 lndex displayed a pessimistic return of 3.7 percent between July 2015 and March ended 2016.

Thus, PSX outperformed the MSCI Emerging Market lndex (-13.9 percent) and the MSCI Frontier Market lndex (- 14.6 percent) by a wide margin.

PSX’s total revenue grew by 11 percent year-on-year to Rs991 million during March 31, 2016 from July 01, 2016. A main factor in this growth was important increase in management fee received through PSX which was Rs144.5 million in 9MFY2015-16 versus Rs86.0 million in 9MFY2014-15.

Excluding management fee, total revenue grew by 5 percent YoY to Rs846 million versus Rs807 million in the corresponding period previous year. Core Operating Revenue increased by 4 percent YoY in 9MFY2015-16 to Rs403 million versus Rs386 million in the corresponding period previous year.

Total listing fee depicted an increase of 9 percent YoY and constituted 43.5 percent of core operating revenue. Within this, yearly listing fees grew by 7 percent YoY based on larger market capitalization while initial listing fees explained 16 percent improvement, driven considerably by few large rights issues which assisted neutralize the weaker showing of new listings (lPO’s) during the period.

The most important drag in core operating revenue came from trading fees which were 3 percent lower YoY during the period and came in at Rs 156.7 million versus Rs161.3 million in 9MFY2014-15, and constituted 38.8 percent of total operating income.

 

ln the Ready Market, average daily trading volume during 9MFY2015-16 was 214 million shares with average price per share of Rs45, leading to average daily traded value of Rs9.6 billion. This contrasts with 9MFY2014-15, when the Ready Market average daily trading volume was also 214 million shares but the average price per share was Rs52, leading to average daily traded value of Rs11.2 billion.

During 9 months closing market is at 31,2016. Non-Operating Revenue grew 16 percent YoY to Rs991 million and constituted almost 55 percent of total revenue. While the YoY change in Net Treasury lncome and Share of profit of Associates was 5 percent and 4 percent respectively, the key driver of Non-Operating Revenue was 68 percent YoY rise in Management Fee, which stood Rs145 million in 9MFY2016 versus Rs86 million in 9MFY2015.

Total Operating Expenses in 9MFY2016 reached at Rs766 million versus Rs639 million in 9MFY2015, explaining an increase of 20 percent. Excluding integration expenses, the rise will be nearer 10 percent. Within this head HR Costs grew by 15 percent YoY after incorporating 9 percent yearly increment awarded previous year and inducting 25 Lahore and lslamabad employees who became part of the PSX team from January 2016 onwards.

With Total Revenue of Rs991 million and Total Expenses of Rs767, Pre tax Profit for the period closing March 31,2016 came in at Rs224 million, versus Rs254 million previous year, depicting a year-on-year fall of 12 percent.

During the period, Earning before interest, tax, depreciation and amortization (EBITDA) turned pessimistic to minus Rs4.8 million from a positive of Rs47 million. Net Treasury lncome of Rs220 million enabled the Exchange to explain an optimistic pretax profit of Rs224 million.

Moreover, the effective tax rate grew to 37.7 percent in 9MFY2016 taking taxation expense to Rs85 million from Rs52 million previous year. As a consequence, Net Profit After Tax came in at Rs140 million versus Rs202 in the corresponding period previous year, leading to Earnings Per Share (EPS) of Re 0.17 versus Re 0.25 last year.

PAKISTAN STOCK EXCHANGE DURING 2016 (Month End)
Month Volume Leader Leader Volume (Mn Shares) Companies
Active Plus Minus Equal
Jan K-Electric Ltd 11 318 154 141 23
Feb SSGC 6.8 336 219 98 19
Mar SNGPL 11.3 318 142 148 28
Apr Bank of Punjab 20 364 153 197 14
May K-Electric 18 381 191 163 27
June K-Electric 24 341 44 276 21

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