Five years ago, the market capitalization of the Company was Rs.1.95 billion which has increased to Rs.4.52 billion on December 31, 2016.
Pakistan Stock Exchange (PSX) generated above average gains in the outgoing year 2016. Benchmark total return KSE-100 Index gained 46% (45% in US$ terms) in 2016 compared to last 10-year average return of 20% (15% in US$ terms) and last 20-year average return of 24% (19% in US$ terms).
Amongst Asian markets Pakistan remained on top. Moreover it also topped the MSCI Frontier Markets. Pakistan market posted 5th highest return in the world. Strong performance of Pakistan equities in 2016 was mainly led by strong local liquidity on account of falling inclusion in the MSCI EM Index.
Automobiles and Cements remained top performing sectors in 2016 posting market cap gains of 73% and 66%, respectively. Index heavy weight Oil & Gas Exploration sector (E&Ps) was up 52% whereas Banks were up 33%. Fertilizer sector was down 5% due to weak fertilizer demand and high inventory levels.
During the year your Company earned Rs.711 million in net income and the portfolio was up 38.66% vs KSE-100 index of 45.68%. The underperformance was primarily due to below market performance of HUBCO having a significant weight of 36% in the total portfolio.
During the year the Company adopted an aggressive stance on the public equities and maintained its exposure at 96% (average), whereas 4% was vested towards mutual funds and Government Securities.