Pakistan’s stock surge sets stage for record IPO wave in 2026: report

Pakistan may see one of its strongest years for initial public offerings (IPOs) in 2026, as a surging stock market and expanding retail participation draw companies back to the equity markets, Bloomberg reported. 

Investment banks Arif Habib Ltd and Ktrade Securities Ltd say they have as many as 16 IPOs lined up for the next seven months, compared with 11 listings in the last three years.

The KSE-100 Index has gained more than 47% this year, making it one of the best-performing equity indices globally. The rally, driven largely by domestic investors, has pushed valuations back to long-term averages, encouraging sponsors to revisit listing plans.

“Current market valuations are attractive for raising equity,” said Shahid Ali Habib, CEO of Arif Habib Ltd, which expects to bring up to eight IPOs by June, adding that a stable rupee and a favourable interest-rate environment are creating strong capital-market momentum.

Companies eyeing listings include those in consumer goods, pharmaceuticals and the automotive sector. Service Long March Tyres Ltd, a joint venture between Servis Group and China’s Chaoyang Long March, plans to raise up to Rs6.5 billion by April, which could be the largest IPO in several years. 

Commodity sourcing startup Saraaf, which raised Rs1.5 billion in Shark Tank Pakistan in 2024, is also preparing to list. Matco Foods Ltd plans to spin off its Falak Foods unit, according to Ktrade Managing Director Omar Salah Ahmed.

Ktrade expects to manage at least six IPOs in the next six months, while JS Global Capital Ltd plans the same number for 2026.

Despite a fourfold increase in equity prices over the past three years, primary markets remained subdued until now. Retail investor confidence, however, is rebounding: nearly 36,000 new trading accounts were opened in the September quarter, up from 23,600 in the previous quarter. Daily trading volumes surpassed $200 million in October, the highest since 2017.

Analysts caution that the KSE-100 is trading at nearly eight times forward earnings, above its long-term average of 6.4 times, raising concerns of overheating. Foreign investors remain cautious, withdrawing $321 million this year, the largest outflow since 2021.

Pakistan’s improving macroeconomic outlook, supported by IMF-backed reforms and credit rating upgrades by S&P Global Ratings and Fitch, has boosted sentiment. Efforts by Field Marshal Asim Munir to stabilise relations with the United States are also perceived as contributing to market stability.

Ktrade’s Ahmed said, “It’s very likely 2026 will be a record year for IPOs. Valuations are finally attractive enough for sponsors to consider listing.”