Despite economic challenges, Bloomberg recognized Pakistan’s stock market as Asia’s best-performing market in 2024.
The KSE-100 index saw a 27% increase in dollar terms, with experts forecasting further growth.
Strategists point to attractive valuations, high real rates, and a stable currency as key factors behind the market’s success.
The recent budget, designed to secure an IMF loan, has also enhanced investor confidence.
Topline Securities Ltd and Arif Habib Ltd project an additional 10% growth in the KSE-100 index by year-end.
Foreign investments are anticipated to continue propelling market momentum.
Ali Hussain, Head of Research at Frontier Investment Management Partners Ltd, believes the market has significant potential for growth, citing favourable financial conditions.
The KSE-100 index trades at a 50% discount to its historical average, with a one-year forward P/E ratio of 3.8.
Islamabad has raised taxes on key industries such as cement, automobiles, and steel to align with IMF requirements. These measures are vital for managing the $24 billion in debt payments due next fiscal year.
Despite political risks, Bloomberg Economics views the government’s stability as robust, even as concerns about coalition dynamics persist.
Investors remain optimistic, with Arif Habib Ltd expecting sustained momentum driven by foreign investment, earnings growth, and strong local liquidity.
Bilal Khan from Arif Habib Ltd anticipates that the ongoing IMF program will bolster the external financial position and maintain positive market sentiment over the coming years.
