listing on pakistan stock exchange - psx.com.pk fileimportance of smes to the pakistani economy 4...

Listing on Pakistan Stock ExchangeSmall 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

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Section 1Introduction

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Importance of SMEs to the Pakistani economy

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There are Approximately 3 Million SMEs in Pakistan

SME output contributes 40% to the annual GDP

SMEs have the potential to drive / stimulate growth provided they are given an

enabling platform to flourish.

Economic Survey of Pakistan 2017

SME Output contributes 25% to the total exports.

SMEs employ 80% of the non-agricultural labor force

Section 2

PSX Listing Requirements

5

What is the Eligibility Criteria?

Main Board

• Minimum post issue paid up capital of

Rs.200 million

SME Board

• Minimum post issue paid up capital of Rs.25

million

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Section 3

SME Board Listing Requirements

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PSX SME Board - a platform for SMEs to raise capital to fund growth and expansion

What are the SME Board Requirements?

Minimum Bid size of each initial subscriber: PKR 1 Million

Minimum five initial subscribers

SME: A public company having a post issue Paid Up Capital

PKR 25 -200 Million

At least 20% of post issue paid up capital to be offered ONLYto QIBs and HNWIs through private placement.

QIBs:Financial Institutions;Insurance Companies;Mutual/Pension Funds

HNWIs:Investor bidding at least Rs.1 Million

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What are the mandatory requirements?

Financial Statements

• Must prepare periodic Financial statements

• Must audit statements by QCR rated chartered accountants

• Must publish on the website

SME Website

• Must contain basic business information

• Must contain Information Memorandum

• Must post annual, half-year quarterly accounts

Operational Requirements

• Must be in business for at least three years

• Must be profitable for at least 2 years before getting listed

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What is the Listing Requirement?

• IM shall be circulated to QIBs and HNWIs.

• IM shall be placed on the website of the SME, the Exchange and the Advisor/Consultant to the Issue.

• Minimum information / disclosures required in the IM: Schedule-I of Chapter 5A of PSX Rule Book.

Information Memorandum

• SME required to disclose and disseminate Price Sensitive Information.

• 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 any disciplinary action such as: Imposing a fine, Placing SME in the Defaulters’ Segment, Suspend trading, etc.

Compliance

(Post Listing)

Section 4

Post Listing

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What happens Post Listing?

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Sponsor Shareholding Lock-in 100% (Entire) holding blocked for 1 year.25% holding blocked for 3 years.

Trading shall take place through KATS.

In the secondary market, the minimum order size for trading shall be PKR 100,000.

Clearing, settlement and risk management through NCCPL.

SME to maintain a minimum free float of 20% of post issue paid up capital.

Section 5

Listing Fee

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What is the Listing Fees?

• 0.05% of Post Paid Up Capital

• Capped at PKR 50,000Initial Listing Fees

• PKR 20,000 on Paid Up Capital up-to PKR 50 Million

• PKR 30,000 on Paid Up Capital between PKR 50-100 Million

• PKR 40,000 on Paid Up Capital exceeding PKR 100 Million Annual Listing Fees

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Section 6

Benefits And Relaxations

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What are the Benefits and Relaxations?

Tax Benefits

Relaxations

• 20% on tax payable in the first tax year of listing• 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

and Securities Regulations” of PSX Rule Book.• Code of Corporate Governance

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Section 7

SME Listing Procedure

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How can you get your company listed on the Exchange?

• SME appoints “Advisor and Consultant”.

• Consultant submits listing application to the Listing Department at PSX

• The listing department reviews documents and performs due diligence

• Your listing application is submitted to the PSX Listing Committee.

• PSX Listing Committee approves the listing application.

• SME offers its shares to eligible investors and gets listed after they subscribe to its shares.

Procedure

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Section 8

De-Listing

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What will be your Exit Strategy?

Voluntary De-listing

You can delist your company through buy-back of shares by the sponsors at a price approved by the Exchange

Involuntary De-listing

Your company can be removed from the listed companies list due to

violation of PSX’s Listing of Companies & Securities Regulations

Migration to Main Board

When paid up capital exceeds PKR 200 Million And SME has been

listed on the SME Board for at least Three years

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Contact Information

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Raeda Latif

General Manager - Marketing and Business

Development

Email: raeda.latif@psx.com.pk

Telephone: +92-2135274580 Ext: 4580

Haris Saeed

Business Development Manager

Email: haris.saeed@psx.com.pk

Telephone: +92-2135274574 Ext: 4582

Mariam Mehtab

Marketing and Business Executive

Email: mariam.mehtab@psx.com.pk

Telephone: +92-2135274572 Ext: 4572

Help Desk (92-21) 111-011-122 Karachi Office Ext: 4580, 4582Lahore Office Ext: 4653Islamabad Office Ext: 4666

Web: psx.com.pkEmail: listing@psx.com.pk

Contact Information

Serving Investors & IndustryStock Exchange Building, Stock Exchange Road,

Karachi-74000, Pakistan. Tel: (+92)111-001-122, Website: www.psx.com.pk