Listing on Pakistan Stock Exchange - Small and Medium Enterprises Board Dream Big and Make it Happen!
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Listing on Pakistan Stock Exchange Small and Medium Enterprises Board Dream Big and Make it Happen!
Contents of the Presentation:
Section 1: Introduction
Section 2: PSX Listing Requirements
Section 3: SME Board Listing Requirements
Section 4: Post Listing
Section 5 :Listing Fee
Section 6: Benefits And Relaxations
Section 7: SME Listing Procedure
Section 8: De-Listing
Section 9: FAQs
2
Section 1
Introduction
3
Importance of SMEs to the Pakistani economy
There are
SMEs have the potential to Approximately 3 SME output
drive / stimulate growth Million SMEs in contributes 40%
provided they are given an Pakistan to the annual
enabling platform to flourish. GDP
SME Output
contributes 25%
to the total
exports.
SMEs employ 80% of the
non-agricultural labor
force
4
Economic Survey of Pakistan 2017
Section 2
PSX Listing Requirements
5
What is the Eligibility Criteria?
Main Board SME Board
• Minimum post issue • Minimum post issue
paid up capital of paid up capital of Rs.25
Rs.200 million million
6
Section 3
SME Board Listing Requirements
7
What are the SME Board Requirements?
PSX SME Board - a platform for
SMEs to raise capital to fund growth QIBs:
and expansion At least 20% of post Financial Institutions;
issue paid up capital Insurance Companies;
Mutual/Pension Funds
to be offered ONLY
to QIBs and HNWIs HNWIs:
Investor bidding at least
through private Rs.1 Million
placement.
Minimum five initial subscribers
SME: A public company having Minimum Bid size of each initial
a post issue Paid Up Capital subscriber: PKR 1 Million
PKR 25 -200 Million
8
What are the mandatory requirements?
Financial Operational
SME Website
Statements Requirements
• Must prepare periodic • Must contain basic • Must be in business for at
Financial statements business information least three years
• Must audit statements by • Must contain Information • Must be profitable for at
QCR rated chartered Memorandum least two preceding years
accountants • Must post annual, half-year before getting listed
• Must publish on the quarterly accounts
website
9
What is the Listing Requirement?
• IM shall be circulated to QIBs and HNWIs.
Information • IM shall be placed on the website of the SME, the Exchange and the
Advisor/Consultant to the Issue.
Memorandum • Minimum information / disclosures required in the IM: Schedule-I of
Chapter 5A of PSX Rule Book.
• SME required to disclose and disseminate Price Sensitive Information.
Compliance • CEO of the SME responsible for regulatory compliance: Must submit
compliance report at the end of each half year.
• If SME violates any provision of SME Regulations, Exchange may take
(Post Listing) any disciplinary action such as: Imposing a fine, Placing SME in the
Defaulters’ Segment, Suspend trading, etc.Section 4
Post Listing
11What happens Post Listing?
Trading shall take place through KATS.
Sponsor Shareholding Lock-in
100% (Entire) holding blocked for
1 year. In the secondary market, the
25% holding blocked for 3 years. minimum order size for trading
shall be PKR 100,000.
SME to maintain a minimum free
Clearing, settlement and risk
float of 20% of post issue paid up
management through NCCPL.
capital.
12Section 5
Listing Fee
13What is the Listing Fees?
• 0.05% of Post Paid Up Capital
Initial Listing Fees • Capped at PKR 50,000
• PKR 20,000 on Paid Up Capital up-to PKR 50 Million
Annual Listing Fees • PKR 30,000 on Paid Up Capital between PKR 50-100 Million
• PKR 40,000 on Paid Up Capital exceeding PKR 100 Million
14Section 6
Benefits And Relaxations
15Why should you list on PSX?
Growth and expansion needs
Raise Long Term Invest or carry out merger & acquisition plans
Invest in new projects
Low-cost Capital Enhance current capacity
Diversify business
Meets working capital requirements
Publicly listed companies achieve a higher valuation
than private enterprises since greater disclosures
Higher Valuation and market pricing lead to a companies market
capitalization/worth.
Reduces long term liabilities by enabling:
Balance Sheet • Payment of its long term loans
Optimization • Reducing its dependence on debtWhy should you list on PSX?
• IPOs add a level of prestige to a Company
Enhances Company’s Public • IPOs can be used as a branding and marketing
Profile tool as they attract media interest, attention and
scrutiny
A listed company has to disclose and disseminate all
material and price sensitive financial information
Improved Relations with which adds to:
Bankers and Suppliers • The business transparency
• Improved relations with Bankers, lenders and
clients
Listing bridges any discord that may arise during a
Business Continuity and transition from the first generation to the next, by
Succession Planning introducing
• Corporate Governance Structures
• Succession Planning
17Why should you list on PSX?
Liquidity Listing brings in liquidity and ready marketability of
the company’s securities.
HR Capital Attract and retain the best talent for your company
because of enhanced reputation.
Public listing creates a market for the Company’s
Feasible and Effective shares and sponsors can sell their shares in the
Exit Strategy secondary market.
18What are the extra benefits and relaxations for SME?
• 20% on tax payable in the first tax year of listing
Tax Benefits • 20% on tax payable in the subsequent tax year
• 10% on tax payable in the following two tax years
respectively
SME need not comply with the
• Provisions of Chapter 5, “Listing of Companies
Relaxations and Securities Regulations” of PSX Rule Book.
• Code of Corporate Governance
19Section 7
SME Listing Procedure
20Procedure to get your company listed on the Exchange?
• Your company chooses a consultant, who does the initial due diligence in regards to
Appoints Advisor and Consultant financials, corporate structuring, legal and regulatory requirements etc., and formulates
your company’s business plan moving forward.
• The business case is evaluated by the consultant using different methodologies and its
Business Plan evaluation demand is gauged for the “Final Offer Structure” to get maximum value for the shares to
be offered.
• After the terms of underwriting have been finalized. bankers to the issue and share
registrar are appointed.
Finalization of Underwritings • The Central Depository Company (CDC) checks for eligibility and induction into their virtual
share depository system.
• Finalize pre-IPO investors with the help of your consultant
• Submit requisite regulatory documents for PSX and SECP and obtain the necessary
Regulatory Filings approvals.
• Conduct road-shows, investor presentations and other marketing and sales events to create
Marketing awareness about the upcoming IPO.
• Share registrar and balloter collect subscription results form all bankers to the issue.
Subscriptions and Balloting
• The bank will transfer the money from the subscriber to the issuers.
Post IPO Clearance
• PSX allocates dates for trading of shares on the Exchange and trading begins. 21Section 8
De-Listing
22What will be your Exit Strategy?
Voluntary De-listing Involuntary De-listing Migration to Main Board
Your company can be removed from When paid up capital exceeds PKR
You can delist your company through
the listed companies list due to 200 Million And SME has been
buy-back of shares by the sponsors
violation of PSX’s Listing of listed on the SME Board for at least
at a price approved by the Exchange
Companies & Securities Regulations Three years
23Contact Information
Raeda Latif
General Manager - Marketing and Business
Development
Email: raeda.latif@psx.com.pk
Telephone: +92-2135274580 Ext: 4580 Help Desk (92-21) 111-011-122
Karachi Office Ext: 4580, 4582
Lahore Office Ext: 4653
Haris Saeed
Islamabad Office Ext: 4666
Business Development Manager
Email: haris.saeed@psx.com.pk
Web: psx.com.pk
Telephone: +92-2135274574 Ext: 4582 Email: listing@psx.com.pk
Mariam Mehtab
Marketing and Business Executive
Email: mariam.mehtab@psx.com.pk
Telephone: +92-2135274572 Ext: 4572
24Contact Information
Serving Investors & Industry
Stock Exchange Building, Stock Exchange Road,
Karachi-74000, Pakistan.
Tel: (+92)111-001-122, Website: www.psx.com.pkYou can also read
