These 5 Could Soar in FY26 according to Arif Habib Limited

As FY26 kicks off, investors are already asking the big question: Where will the market’s next big returns come from? Arif Habib Limited (AHL), one of Pakistan’s leading brokerage houses, has crunched the numbers and published its outlook on stocks with the highest total return potential for the year ahead. Total return includes both price appreciation and dividend payouts, giving a more complete picture of expected investor gains.

While the broader market outlook remains cautiously optimistic, AHL’s top picks show a remarkable concentration in sectors that are often overlooked or misunderstood by retail investors. The upside potential in some of these names isn’t just impressive—it’s extraordinary.

Here are the five stocks AHL believes could deliver the highest total returns in FY26.

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5. Meezan Bank Ltd (MEBL)

Meezan Bank, the pioneer of Islamic banking in Pakistan, continues to outperform its peers through disciplined risk management, efficient cost control, and sector leadership. It has become a cornerstone holding for investors seeking both profitability and Shariah compliance.

Recent Performance

Over the past five years, Meezan has delivered an impressive average return on equity of approximately 42 percent, consistently placing it at the top of the banking sector. Its deposit profile is exceptionally strong, with 50 percent of deposits held in current accounts, helping keep its cost of deposits at just 3.4 percent for CY25.

The bank maintains a conservative lending strategy, reflected in a low infection ratio of 2 percent and a strong coverage ratio of 160 percent. These risk controls have enabled it to weather economic volatility while maintaining healthy earnings.

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Meezan topped industry profitability rankings in both CY23 and CY24 and is expected to continue its strong performance with projected earnings of PKR 47.5 per share in CY25 and PKR 53.4 in CY26.

Backed by a capital adequacy ratio of around 19.5 percent, the bank is financially well-positioned to continue rewarding shareholders even as earnings growth moderates.

Price Target and Return Potential

Arif Habib Limited assigns MEBL a June 2026 target price of PKR 455.6, translating to a total return of 36 percent from current levels. This includes a projected dividend of PKR 30 per share in FY26, offering investors a solid combination of income and moderate capital appreciation. For those seeking long-term exposure to a stable, Shariah-compliant bank with consistent performance, MEBL remains a compelling choice.

⚠️ This post reflects the author’s personal opinion and is for informational purposes only. It does not constitute financial advice. Investing involves risk and should be done independently. Read full disclaimer →