karachi meezan index
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KARACHI MEEZAN 30-INDEX
KARACHI MEEZAN
30-INDEX
GROUP MEMBERSGROUP MEMBERS
• Muhammad Hameed• M. Abubakar Siddique• Mirza Ali Raza• Sheikh Hamid Mukhtar• Shakeela Saleem• Muhammad Abubakar
KARACHI MEEZAN 30-INDEX
PRESENTATION OUTLINESPRESENTATION OUTLINES
KARACHI MEEZAN 30-INDEX
• Introduction
• Objective of Launch
• KMI – 30 Composition
• Eligibility Criteria
• Adjustments in the Islamic Index against corporate action
INTRODUCTION
KARACHI MEEZAN 30-INDEX
INTRODUCTION…..INTRODUCTION….. KSE and Al-Meezan Investment
Management Limited launched its first co-branded Islamic Index (KMI-30)
Al Meezan Investments provide its Shariah expertise, guidelines, skills and stocks screening towards the activities with regard to launching and continuation process of the Index. On the contrary, KSE provides maintenance and dissemination support for the index.
KARACHI MEEZAN 30-INDEX
FREE FLOAT METHODOLOGY….FREE FLOAT METHODOLOGY….
Free float calculation
Total Outstanding Shares xxx
Less:
Shares held by directors/sponsors xxx
Govt. holdings as promoter/ acquirer/controller xxx
Shares held by associated companies xxx
Shares held with public in physical form xxx ____
xxx
____
KARACHI MEEZAN 30-INDEX
OBJECTIVE OF LAUNCHOBJECTIVE OF LAUNCH
KARACHI MEEZAN 30-INDEX
OBJECTIVE OF LAUNCH…OBJECTIVE OF LAUNCH…
To provide investors suitable benchmark for returns on Shariah Compliant equity investments.
To help shariah conscious people choose the profitable stocks which are Shariah Compliant.
To provide a relevant benchmark to Islamic equity funds for comparing their performance.
KARACHI MEEZAN 30-INDEX
KMI – 30 COMPOSITIONKMI – 30 COMPOSITION
KARACHI MEEZAN 30-INDEX
KMI – 30 Index comprises of 30 Shariah Compliant Companies.
Shariah compliance is ensured through Stock Screening process conducted by Al-Meezan Investment Management Limited and counter checked by Capital Advisory division of PDSC Department.
KARACHI MEEZAN 30-INDEX
KMI 30-INDEX KMI 30-INDEX COMPOSITION...COMPOSITION...
KMI-30, Effective from 2011
KARACHI MEEZAN 30-INDEX
Product Development & Shariah Compliance
S-NO.
NAME OF COMPANY
S-NO.
NAME OF COMPANY
1 ATTOCK CEMENT 16 NISHAT MILLS LTD
2 ATTOCK REFINERY 17 OIL & GAS DEVE.
3 D.G.K.CEMENT 18 P.S.O.
4 FAUJI FERT BIN QASIM 19 P.T.C.L.A
5 FAUJI FERTILIZER CO. 20 PACKAGES LIMITEDXD
6 GLAXOSMITHKLINEXDXB 21 PAK OILFIELDS LTD.
7 HUB POWER CO. 22 PAK PETROLEUM
8 ICI PAKISTANSPOT 23 PAK REFINERY
9 INDUS MOTOR CO 24 PAK SUZUKI MOTORXD
10 KOT ADDU POWER CO. 25 SHELL PAKISTAN XD
11 LOTTE PAKPTAXD 26 SUI NORTH GAS
12 LUCKY CEMENT LTD. 27 SUI SOUTH GAS
13 MARI GAS CO. 28 THAL LTD
14 MILLAT TRACTORS 29 TRI-PACK FILMS
15 NATIONAL REFINERY 30 UNILEVER PAKXD
ELIGIBILITY CRITERIAELIGIBILITY CRITERIA
KARACHI MEEZAN 30-INDEX
ELIGIBLE FOR KMI 30 INDEX…ELIGIBLE FOR KMI 30 INDEX…
Securities are available in central depository system
Formal listing of two month on KSENot defaulterCompany have free _float shares of 5% of
total outstandingSecurities are traded 75% of the total
trading days
KARACHI MEEZAN 30-INDEX
NOT ELIGIBLE FOR KMI 30 INDEXNOT ELIGIBLE FOR KMI 30 INDEX
Interest relatedGambling or alcoholArms ManufacturingInsurance both life and generalNon Halal foodDefaulter CompanyMutual funds both open-ended and close
ended
KARACHI MEEZAN 30-INDEX
CRITERIA ACCORDING TO CRITERIA ACCORDING TO FINANCIALFINANCIAL
RATIOS RATIOS
KARACHI MEEZAN 30-INDEX
LEVERAGE COMPLIANCELEVERAGE COMPLIANCE
Interest Bearing Debt < 40% of Total Interest Bearing Debt < 40% of Total AssetsAssets
Interest Bearing Debt includes Bonds, TFCs, Conventional Bank Loans, Finance Lease, Preference Shares etc.
Total Interest bearing Debt must be less than 40% of the Total assets of the investee company
KARACHI MEEZAN 30-INDEX
INVESTMENT COMPLIANCEINVESTMENT COMPLIANCE
Non-Shariah Compliant Investments < Non-Shariah Compliant Investments < 33% of Total Assets33% of Total Assets
Non-Shariah Compliant Investments include investments in conventional mutual funds, conventional money market instruments, Bonds, T-Bills, all Interest based placements and interest based loans and advances etc.
Non-Shariah Compliant investments must be less than 33% of Total Assets of the investee company.
KARACHI MEEZAN 30-INDEX
Income Compliance…Income Compliance…
Non-Compliant Income < 5% of Non-Compliant Income < 5% of Total RevenueTotal Revenue
Non Compliant Income includes Bank Interest, Income from gambling, nightclubs, prostitution, casino, tobacco, alcohol, dividend income from above mentioned businesses, dividend income from Shariah non-Compliant Companies etc.
Capital Gain need not be purified.
Non-Shariah Compliant income must be less than 5% of Total Revenue of the investee company.
KARACHI MEEZAN 30-INDEX
Total Revenue includes Gross Sales + Other Operating Income.
Dividend Purification is done by disbursing amount in Charity calculated as per the Charity rate determined and approved by PDSC.
ILLIQUID ASSETS ILLIQUID ASSETS COMPLIANCE…COMPLIANCE…
Compliance is measured as Illiquid assets / total assets>20%
KARACHI MEEZAN 30-INDEX
BASE PERIOD….BASE PERIOD….The index committee has used 15,000 as the
base value
June - 30- 2008 base the base year
Islamic index = Free float market capitalization
Index divisor Index divisor = Free float market capitalization
slamic index
Review period and Re-Review period and Re-compositionscompositions
The index will always be re-composed on semiannual basis
Basis Basis Revision Revision December 31 May 15
June 30 November 15
KARACHI MEEZAN 30-INDEX
Adjustment for cash dividendAdjustment for cash dividend
Adjustment for Bonus SharesAdjustment for Bonus Shares
Adjustment for Right SharesAdjustment for Right Shares
KARACHI MEEZAN 30-INDEX
Adjustments in the Islamic Adjustments in the Islamic Index against corporate Index against corporate
actions..actions..
KARACHI MEEZAN 30-INDEX