Karachi Stock Exchange (Guarantee) Limited:
A brief description about Karachi Stock Exchange (Guarantee) Limited (KSE).
Karachi Stock Exchange (Guarantee) Limited (KSE), currently the biggest and most liquid
stock exchange in Pakistan, was established on September 18, 1947. It was incorporated
on March 10, 1949. Only five companies were initially listed with a total paid-up capital
of 37 million rupees. The first index introduced in KSE was based on fifty companies and
was called KSE 50 index. Trading used to be carried out on open out-cry system.
With growth in number of listed companies and trading activities, a dire need for a true
representative index and computerization of trading activities was felt. As a result KSE 100
Index was introduced on November 1, 1991. Computerized trading system called Karachi
Automated Trading System (KATS) was introduced in 2002 with a capacity of 1.0 million
trades per day and the ability to provide connectivity to an unlimited number of users.
To reconfirm the KSE-100 and to provide the basis of index trading in future, an all share
index was introduced in 1995 which became operational on September 18, 1995. To address the
needs of investor community two other indexes were also introduced later on called KSE 30
Index and KMI 30 Index.
Karachi Stock Exchange is located on Stock Exchange Road, in the heart of business district
of Karachi. The premises is known as Stock Exchange Building.
Listing in KSE:
As on November 25th, 2015 there are 577 companies listed in KSE
and the total market capitalization is Rs. 7,072.647 billions.
The listing is done on the basis of strict rules and regulations laid out by
Securities Exchange Commission of Pakistan (SECP) & Karachi Stock Exchange
(Guarantee) Limited. All the listed companies are categorized in various main business
sectors. As on November 25th, 2015 there are total 35 sectors
listed on Karachi Stock Exchange which contribute towards the market capitalization
and all the listed companies (excluding their future contracts) are divided among these.
Rest of the noncontributory sectors are allocated for indexes, futures, bonds etc.
For a complete list of sectors,
For a complete list of listed companies,
Detailed information about these indexes can be obtained from KSE's web site
KSE 100 Index:
The KSE-100 Index was introduced in November 1991 with base value
of 1,000 points. The Index comprises of 100 companies selected on
the basis of sector representation and highest free-float capitalization,
which captures over 80% of the total free-float capitalization of
the companies listed on the Exchange. 35 companies are selected i.e. one company from each sector on the
basis of the largest free-float capitalization and the remaining
65 companies are selected on the basis
of largest free-float capitalization in descending order. This is
a total return index i.e. dividend, bonus and rights are adjusted.
It is revised after every six months for inclusion or exclusion of
companies on the basis of above mentioned criteria.
Free-Float is the proportion of total paid-up shares issued by a
company that are readily available for trading at a Stock Exchange.
It implies that the shares held by controlling directors, sponsors,
promoters, government and other locked-in shares which are not
available for trading in the normal course are excluded.
During 2012, the governing board of directors of the Karachi Stock
Exchange (KSE) decided to implement the KSE-100 Index on the basis of
free-float market capitalization instead of total market capitalization.
The Rules for composition and recomposition of the Index based on
free-float methodology have remained un-changed other than selection
of companies on the basis of free-float market capitalization as
against total market capitalization.
KSE ALL Index:
In 1995, the need was felt for an all share index to reconfirm the
KSE-100 and also to provide the basis of index trading in future.
By August 29, 1995 the KSE-All Share Index was constructed which
became operative on September 18, 1995.
is calculated using total market capitalization method.
KSE 30 Index:
In June 2005, another benchmark index named KSE-30 was introduced
with a base value of 10,000 index points to provide investors with
a sense of how large companies' scrips of the Pakistan’s equity
market are performing over a period of time. Thus, the KSE-30 Index
is designed in such a way that it becomes comparable over a period
of time similar to other indicators that track various sectors of
country’s economic activity such as the gross national product,
consumer price index etc.
KSE-30 Index is calculated
using the free-float capitalization methodology.
KMI 30 Index:
Introduced in Spetember 2008, the objective of KSE-Meezan Index (KMI) is to serve
as a gauge for measuring the performance of Shariah compliant equity investments.
Besides tracking performance of Shariah compliant equities, its construction will
increase investor trust and enhance their participation.
KSE-Meezan Index is also calculated using the “Free-Float Capitalization”.
For a list of current Shariah compliant companies and their selection criteria
Al-Meezan Investment Management Limited
ALL SHARES ISLAMIC Index:
Introduced on November 18, 2015 as a joint effort by the management of
Karachi Stock Exchange (KSE) and Meezan Islamic Bank Limited.
The principal objective of the All Shares Islamic Index is to gauge
the performance of the Shariah compliant segment of the equity market.
Accordingly, it is important that all those shares which meet the
Shariah screening criteria should be included in the All Shares Islamic
Index in order to ensure completeness of the index and adherence to
the core objective of the proposed All Shares Islamic Index.
The companies included in this index are selected on the basis of a six
factors selection criteria. First criteria is that the core business
of the company must be permissable in Islamic Shariah and also on ethical
grounds. Other five factors determine the financial compliance of the
companies. After selection, these companies pass through another six
stage filter to exclude defaulter, non-operational companies along with
all Mutual Fund companies.
Base value for this index has been set at 15,000 points. Review and
Re-composition will be carried out bi-annually.
You can get download a complete brochure and current list of companies
included in this index from the official web site of
Karachi Stock Exchange. For your
convenience we have also given below direct links to both the files.
Download complete brochure here
Download complete list of current companies here
Other Stock Exchanges in Pakistan:
Lahore Stock Exchange (Guarantee) Limited (LSE):
Lahore Stock Exchange is Pakistan's second largest stock exchange after the Karachi
Stock Exchange (KSE).
It came into existence in October 1970, under the Securities and Exchange Ordinance
of 1969 by the Government of Pakistan in response to the needs of the provincial
metropolis of the province of Punjab. It initially had 83 members and was housed in
a rented building in the crowded Bank Square area of Lahore. The LSE was the first
stock exchange in Pakistan to use the internet and currently 50% of its transactions
are carried out via internet.
The Lahore Stock Exchange has opened branches in the industrial cities of Faisalabad
and Sialkot for trading. The Sialkot branch is referred to as the "Sialkot Trading
Islamabad Stock Exchange (Guarantee) Limited (ISE):
Islamabad Stock Exchange is the youngest of the three stock exchanges of Pakistan.
It is located in Islamabad, the capital city of Pakistan. The Islamabad Stock
Exchange (ISE) was incorporated as a guarantee limited Company on October 25, 1989
in Islamabad Capital territory of Pakistan with the main object of setting up of a
trading and settlement infrastructure, information system, skilled resources,
accessibility and a fair and orderly market place that ranks with the best in the
world. The purpose for establishment of the stock exchange in Islamabad was to cater
to the needs of less developed areas of the northern part of Pakistan. It was
licensed as a stock exchange on January 7, 1992.
The ISE Towers comprise twin 22 storey towers with unique and inspiring amenities,
offer futuristically and aesthetically designed offices with panoramic views, is
constructed over a piece of land measuring 5600 square yards in the heart of
Islamabad at Jinnah Avenue (Blue Area) which is the hub of all business and
commercial activities in Islamabad. The building is facing 400 feet wide Jinnah
Avenue on one side and has another entrance from 100 feet wide Nazim-ud-din Road.