ISLAMABAD: The Pakistan Stock Exchange (PSX) delivered a historic performance in FY25, marking it as one of the best-performing stock markets globally.
According to the Economic Survey 2024-25, the KSE-100 index surged by 50.2% during July–March, climbing from 78,445 to 117,807 points.
The index reached its peak of 118,770 on March 20, 2025, and as of June 5, it had further climbed 54.3% to 121,641 points.
This rally boosted market capitalisation by 41.8% to Rs14,729 billion from Rs10,432.69 billion.
Strong Fundamentals Behind Market Rally
The surge in PSX was underpinned by multiple economic factors including robust corporate earnings, a successful IMF programme review, declining inflation leading to reduced interest rates, and improved macroeconomic stability.
These factors bolstered investor confidence and resulted in a record average daily trading volume of 828 million shares, compared to 621 million in FY24.
As of March 31, 2025, PSX had 527 listed companies with listed capital of Rs1,727 billion and market capitalisation of Rs14,374 billion.
Total funds raised on the exchange during July–March FY25 amounted to Rs9.74 billion, including Rs8.99 billion from equity listings and Rs750 million in debt securities.
Foreign investors offloaded $242 million worth of securities, which were absorbed by domestic participants, indicating strong local investor confidence.
As of March 31, PSX’s market capitalisation stood at $51.3 billion, up from $37.3 billion on June 30, 2024 — a gain of 38.5% or Rs4 trillion.
Global Recognition and Sectoral Growth
Bloomberg ranked PSX among the world’s top-performing equity markets in calendar year 2024.
Foreign investment rose by 30%, the highest in over a decade, while the KSE-100 index posted returns of 85% in rupee terms and 87% in dollar terms.
Despite this performance, PSX remains deeply undervalued compared to regional peers, with a one-year forward P/E ratio of around 6.0x — nearly 50% below its long-term average.
Sector-wise, commercial banks led market capitalisation with an 18.7% share, followed by oil & gas exploration (17.4%), food & personal care products (9.2%), cement (8.3%), and fertilisers (7.2%).
These five sectors contributed 60.8% to total market capitalisation.
Among the best-performing sectors were pharmaceuticals, jute, and transport, while fertiliser and energy sectors showed strong growth momentum.
Despite record highs, analysts believe PSX holds more upside due to its attractive valuations and improving economic indicators.
