Pakistan Stock Exchange (PSX) has announced the launch of the listing board to facilitate SMEs and tech startups. This decision will not only help small and medium-size companies but also startups to raise equity capital and to climb the ladder of success.
This is a great opportunity for small businesses to expand their business at a lower cost. Pakistan Stock Exchange revealed that the listing regulations for Growth Enterprise Market (GEM) board are simple. PSX has also provided the leverage of low-cost listing to help the small companies.
Additionally, Small and medium-size companies will also be able to register their business on the mainboard after a few years as they reach the maturity stage. Pakistan Stock Exchange has disclosed that the listing process has already begun as six companies have started the listing process.
Managing Director of PSX Farrukh Khan said that tech startups, small businesses, and greenfield projects, will be able to register their businesses on the stock exchange with the help of the Growth Enterprise Market (GEM) board. PSX is expecting that the first listing would be started on the GME board by the end of this fiscal year.
He further revealed that there will be few restrictions for the investors as this market is highly risky. Only qualified investors will be able to invest in GME.
Earlier, the Securities and Exchange Commission of Pakistan (SECP) has confirmed the GME listing regulations to support small businesses and startups to increase their funds through PSX. The new GME board has replaced the previously existed SME board which failed to attract any listing because of the restrictions.
It has been revealed earlier that small businesses only required audited reports of the past two years and post-issue paid-up capital of at least Rs25 million for listing on the GEM board in November 2019. The minimum fee for listing on the GEM board is Rs.50,000. This amount is only one-fourth of the listing requirement on PSX main board of Rs. 200,000.
PSX has discussed with SECP to lessen the listing regulations and this decision will attract more listing on the board. PSX head also disclosed that a surveillance system has been implemented in the market which would help in options and index trading.
Stock Exchange has already introduced exchange-traded funds which are the perfect product for small investors. PSX is currently working to develop the product. It has also increased the time period of the future market offers to a 90-day future contract than the 30-day future contract currently.
The economy of Pakistan is booming because of the few measures taken by the government such as flexible fiscal policy, low-interest rates, and other social initiatives. PSX didn’t halt operations for a single minute as compared to other regional stock exchanges such as Bangladesh and Sri Lanka, Khan added.