Karachi Stock Exchange (Guarantee)

Limited:
Brief History:
Karachi Stock Exchange (Guarantee) Limited (KSE), currently the biggest and most
liquid stock exchange in Pakistan, was established on Setember !", !#$%& 't was
incororated on (arch !), !#$#& *nly +i,e comanies were initially listed with a total
aid-u caital o+ .% million ruees& /he +irst index introduced in KSE was based on +i+ty
comanies and was called KSE 0) index& /rading used to be carried out on oen out-cry
system&
1ith growth in number o+ listed comanies and trading acti,ities, a dire need +or a true
reresentati,e index and comuteri2ation o+ trading acti,ities was +elt& 3s a result KSE
!)) 'ndex was introduced on 4o,ember !, !##!& 5omuteri2ed trading system called
Karachi 3utomated /rading System (K3/S) was introduced in 6))6 with a caacity o+
!&) million trades er day and the ability to ro,ide connecti,ity to an unlimited number
o+ users&
/o recon+irm the KSE-!)) and to ro,ide the basis o+ index trading in +uture, an all share
index was introduced in !##0 which became oerational on Setember !", !##0& /o
address the needs o+ in,estor community two other indexes were also introduced later on
called KSE .) 'ndex and K(' .) 'ndex&
Karachi Stock Exchange is located on Stock Exchange 7oad, in the heart o+ business
district o+ Karachi& /he remises is known as Stock Exchange 8uilding&
Listing in KSE:
3s on (arch .!st, 6)!$ there are 0"! comanies listed in KSE and the total market
caitali2ation is 7s& 9,6%%&$.% billions& /he listing is done on the basis o+ strict rules and
regulations laid out by Securities Exchange 5ommission o+ Pakistan (SE5P) : Karachi
Stock Exchange (Guarantee) Limited& 3ll the listed comanies are categori2ed in ,arious
main business sectors& /here are total .9 sectors listed on Karachi Stock Exchange& *ut
o+ these, .6 sectors contribute towards the market caitali2ation and all the listed
comanies (excluding their +uture contracts) are di,ided among these& 7est o+ the $
sectors are allocated +or indexes, +utures bonds etc&
/hese non market caitali2ation contributing sectors are as +ollows;
8onds
<uture 5ontracts
4on Equity 'n, 'nstruments
Stock 'ndex <uture 5ontracts
BUSIESS SE!"#$S:
% &ist of a&& 'usiness sectors current&y &isted at Karachi Stock Exchange (KSE)(
S& 4o& Sector 5ode Sector 4ame (arket 5aitali2ation (7s&)
! ..0) 3utomobile and Parts #.,0!),""#,%9.
6 .0.) 8e,erages 6!,.".,)96,"6"
. !.0) 5hemicals 00),6!",!$),$%"
$ ".0) 5ommercial 8anks !,!#","!),66!,!99
0 6.0) 5onstruction and (aterials (5ement) ..),!%),6!%,."$
9 %0.) Electricity !"6,096,9$!,009
% 6%.) Electronic and Electrical Goods 6,."!,!".,"")
" 6%0) Engineering $),.#9,6.!,%!9
# "#") Equity 'n,estment 'nstruments 69,9.9,%6!,%0!
!) "%%) <inancial Ser,ices .0,)0#,)!#,!!.
!! 90.) <ixed Line /elecommunication !!$,!0%,.$6,%!.
!6 .0%) <ood Producers 9"0,#!$,699,#0%
!. !%.) <orestry (Paer and 8oard) #,$#.,696,9%$
!$ 6%6) General 'ndustrials 96,"#.,.%$,%$6
!0 $0.) =ealth 5are Equiment and Ser,ices 9,!".,6%0,0)6
!9 .%6) =ousehold Goods .#,6.%,%60,%#9
!% !%0) 'ndustrial metals and (ining 6.,906,6)9,)96
!" 6%%) 'ndustrial /ransortation $6,)9#,""#,0!9
!# .%$) Lesiure Goods ((iscellaneous) .0.,00%,#"0
6) "0%) Li+e 'nsurance 60,6)!,)#%,.)0
6! 000) (edia %,)$$,9!%,6#"
66 %0%) (ultiutilities (Gas and water) .0,66#,")),.$)
6. "0.) 4on Li+e 'nsurance #$,6#!,")),#.!
6$ 0.) *il and Gas !,"#.,)!$,##6,0%#
60 .%9) Personal Goods (/extile) .90,609,.!#,)!6
69 $0%) Pharma and 8io /ech !)9,%..,$)",!)0
6% "9.) 7eal Estate 'n,estment and Ser,ices !,6%0,."6,%."
6" #0.) So+tware and 5omuter Ser,ices 6,###,#)6,"9#
6# 6%#) Suort Ser,ices 0,%90,$$$,.$"
.) #0%) /echnology =ardware and Equiment .,9"9,!)9,0""
.! .%") /obacco 6.$,%%%,%".,6)"
.6 0%0) /ra,el and Leisure .%,)%9,#!$,%.9
.. .9 8onds )
.$ $) <uture 5ontracts )
.0 "##) 4on Equity 'n, 'nstruments )
.9 $! Stock 'ndex <uture 5ontracts )
)%$KE" I*E+ES:
KSE ,-- Index:
/he KSE-!)) 'ndex was introduced in 4o,ember !##! with base ,alue o+ !,)))
oints& /he 'ndex comrises o+ !)) comanies selected on the basis o+ sector
reresentation and highest market caitali2ation, which catures o,er #)> o+ the
total market caitali2ation o+ the comanies listed on the Exchange& *ut o+ the
abo,e mentioned .9 Sectors, .6 comanies are selected i&e& one comany +rom
each sector (excluding the non market caitali2ation contributing sectors) on the
basis o+ the largest market caitali2ation and the remaining 9" comanies are
selected on the basis o+ largest market caitali2ation in descending order& /his is a
total return index i&e& di,idend, bonus and rights are ad?usted&
KSE %LL Index:
'n !##0, the need was +elt +or an all share index to recon+irm the KSE-!)) and
also to ro,ide the basis o+ index trading in +uture& 8y 3ugust 6#, !##0 the KSE-
3ll Share 'ndex was constructed which became oerati,e on Setember !", !##0&
Similar to KSE !)) 'ndex, KSE 3LL 'ndex is also calculated using market
caitali2ation method&
KSE .- Index:
/he rimary ob?ecti,e o+ the KSE-.) 'ndex is to ha,e a benchmark by which the
stock rice er+ormance can be comared to o,er a eriod o+ time& 'n articular,
the KSE-.) 'ndex is designed to ro,ide in,estors with a sense o+ how large
comanies@ scris o+ the PakistanAs equity market are er+orming& /hus, the KSE-
.) 'ndex will be similar to other indicators that track ,arious sectors o+ countryAs
economic acti,ity such as the gross national roduct, consumer rice index, etc&
KSE-.) 'ndex is calculated using the B<ree-<loat 5aitali2ationC methodology& 'n
accordance with methodology, the le,el o+ index at any oint o+ time, re+lects the
+ree-+loat market ,alue o+ .) comanies in relation to the base eriod& /he +ree-
+loat methodology re+ers to an index construction methodology that takes into
account only the market caitali2ation o+ +ree-+loat shares o+ a comany +or the
urose o+ index calculation&
K)I .- Index:
'ntroduced in Setember 6))", the ob?ecti,e o+ KSE-(ee2an 'ndex (K(') is to
ser,e as a gauge +or measuring the er+ormance o+ Shariah comliant equity
in,estments& 8esides tracking er+ormance o+ Shariah comliant equities, its
construction will increase in,estor trust and enhance their articiation&