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Pakistan Stock Exchange Proposes Reforms to Enhance Visibility, Streamline Public Offerings

Strategic Insights

— 2 min read

The Pakistan Stock Exchange (PSX) has introduced a series of amendments to its regulations aimed at simplifying listing requirements, enhancing regulatory clarity for Real Estate Investment Trusts (REITs), and revising the Growth Enterprise Market (GEM) Board framework. The proposed reforms cover three key areas: listing requirements for public offerings, REIT Scheme listings, and GEM Board framework. To comply with the Securities and Exchange Commission of Pakistan's (SECP) Public Offering Regulations, 2017, and the Companies Act, 2017, PSX has proposed several changes to its listing process, including the removal of the eight-month limit for audited accounts and the elimination of certain procedural requirements. The goal of these reforms is to modernize Pakistan's capital market architecture and improve accessibility, especially for smaller issuers and REIT schemes.

Key Takeaways:

  • PSX has proposed amendments to its regulations to simplify public offerings, enhance visibility for REITs, and overhaul the GEM Board framework.
  • The proposed reforms cover three key areas: simplification of listing requirements for public offerings, regulatory refinements for REIT Scheme listings, and structural updates to the GEM Board framework.
  • Companies will be required to submit the latest two years of audited financial statements, supplemented by management accounts if applicable, instead of the current eight-month limit.
  • PSX plans to eliminate certain procedural requirements, such as credit rating timelines and board resolutions, which would instead fall under the purview of SECP regulations.
  • For REIT schemes, PSX has proposed updates to Chapter 5 of its regulations to bring greater regulatory clarity and post-listing accountability, including defining key terms and ensuring consistent use of the term 'Unit of REIT Scheme.'
  • A new clause, 5.20A, has been introduced, requiring REIT management companies (RMCs) to comply with all post-listing disclosure requirements in line with SECP expectations.
  • PSX has proposed structural reforms to revitalize the GEM Board, including replacing the Information Memorandum (IM) route with a simplified Prospectus model and introducing a post-issue paid-up capital (PIPC) cap of Rs500 million.
  • The proposals also include increasing the minimum public free float from 10% to 15% and expanding the minimum number of subscribers from 10 to 50.
  • PSX has invited public comments on the proposed changes by July 8, 2025, in accordance with Section 7(3) of the Securities Act, 2015.

Statistics:

  • Rs500 million: the proposed post-issue paid-up capital (PIPC) cap for GEM listings.
  • 15%: the proposed minimum public free float for GEM listings.
  • 50: the proposed minimum number of subscribers for GEM listings.
  • 10%: the current minimum public free float for GEM listings.
  • 10: the current minimum number of subscribers for GEM listings.

Sources:

  • A formal notice issued by the Pakistan Stock Exchange (PSX).
  • Section 7(3) of the Securities Act, 2015.
  • The Securities and Exchange Commission of Pakistan's (SECP) Public Offering Regulations, 2017.
  • The Companies Act, 2017.
  • PSX/N-327 (March 2025).

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