A net outflow of $288.56 million foreign investment has been witnessed from the Pakistan's stock market during 2017-18, reflecting a negative 56 percent over the previous fiscal year.
According to the annual report of the Securities and Exchange Commission of Pakistan (SECP) for 2017-28 issued here on Friday, the year started with a steady decline in the market, followed by a successful recovery, which lost its impact towards the end. On July 1, 2017, the KSE 100 index began from 44,665.41 points and closed at 41,910.90 on June 30, 2018, almost 7% down from its starting point. KSE 100 touched its lowest, i.e. 37,919.42 on December 19, 2017 and its highest level was 47,084.34 points on August 3, 2017. The average daily turnover was 174.532 million shares. A total 558 companies, with accumulated paid-up capital of Rs 1,297.375 billion are listed on the Pakistan Stock Exchange (PSX). By end of financial year, the total market capitalization stood at Rs 8,665.045 billion, about 9% down as compare to the last year.
During the year, a net outflow of $288.56 million foreign investment witnessed from the stock market, reflecting a negative 56% over the last year. However, despite turbulence, all settlements were executed in a timely manner, demonstrating strength of the capital market, the SECP said.
In order to ensure the orderly execution of the market operations, significant measures have been taken by the SECP. In various instances of noncompliance with the regulatory provisions, the Securities Market Division of the SECP initiated six enquiries and investigations, conducted five inspections/specific purpose reviews and initiated and completed 30 thematic reviews with regard to customer due diligence and AML. The department also referred six cases for criminal prosecution i.e. one for insider trading, one for market manipulation and four others market abuses.
During FY18, 240 cases of non-compliance with regulatory framework, identified as a result of investigation/inspection of brokerage houses and non-compliance with PSX rulebook and CDC regulatory framework were referred for adjudication.
The asset size of NBF sector has been increasing at a steady pace during the past few years. On June 30, 2018, it stood at Rs1,228 billion as compared to Rs1,196 billion on June 30, 2017, reflecting an overall increase of 2.70%.
During FY-2017-18, five companies including two modarabas offered shares /modaraba certificates to the public as compared to shares of four companies offered last year. New capital of Rs6.48 billion was listed in market as compared to Rs11.651 billion listed in FY-2016/17.
The report said that the SECP monitors trading activities of beneficial owners of listed companies through filing of online annual returns by the listed companies and trading data of PSX along with returns filed by the beneficial owners. The primary objective of this monitoring is to detect the instances, where gain made by the beneficial owners by purchase and sale or sale and purchase of shares of issuer companies within a period of less than six months, and recovering the same for onward credit to the Federal Consolidated Fund. The SECP received 2,650 returns both from the listed companies and the Beneficial Owners during the period under review.
Within the insurance sector, in December 2017, the industry's total premium revenue stood at Rs308.46 billion ($2.789 billion), excluding reinsurance, whereas, the industry's total assets stood at Rs1,298 billion ($11.74 billion). In 2017, premium revenue of life insurers and non-life insurers grew by 18% and 12% respectively, while the overall growth rate during this period remained 16%. The life insurance sector underwrote premium of Rs213.6 billion, and non-life insurance sector recorded premium of Rs 94.8 billion, the SECP added.
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