The Pakistan Stock Exchange (PSX) has announced a special recomposition of its benchmark indices, with BankIslami Pakistan Limited (PSX: BIPL) and Air Link Communication Limited (PSX: AIRLINK) replacing Fauji Fertilizer Bin Qasim Limited (FFBL) in the KSE-100 and KSE-30 indices, respectively. The adjustment follows the merger of FFBL with Fauji Fertilizer Company Limited (FFC) under a Scheme of Arrangement, in line with PSX’s index management rules.
The changes will take effect from Monday, December 23, 2024, reflecting the evolving dynamics of listed companies on the exchange.
The KSE-100 Index, regarded as the benchmark for Pakistan’s stock market, represents the top-performing companies in terms of market capitalisation and trading activity. To qualify for inclusion, companies must meet specific criteria outlined by PSX, including a minimum free-float threshold, sustained liquidity, and adherence to corporate governance standards. This ensures that the index reflects robust and investable companies, providing an accurate barometer of the market’s overall performance.
Meanwhile, the KSE-30 Index, introduced in 2006, is a more concentrated measure focusing on the 30 most liquid stocks with the highest market capitalisation. Like the KSE-100, it requires constituents to maintain high free-float shares and active trading volumes, ensuring that the index remains representative of the most dynamic and trade-able securities in the market.
The recomposition comes as a result of FFBL’s merger into FFC, a move that renders FFBL ineligible for index inclusion as a separate entity. The addition of BankIslami to the KSE-100 and Air Link to the KSE-30 highlights their growing market stature and compliance with the stringent criteria set by PSX.
