PSX’s record performance sets stage for 16 IPOs in 2026

The Pakistan Stock Exchange (PSX) is experiencing a record-breaking performance, prompting companies to turn to equities for funding, with bankers predicting a banner year for initial public offerings (IPOs) in 2026. According to Bloomberg’s report on Wednesday, leading investment banks Arif Habib Ltd. and Ktrade Securities Ltd. have a combined pipeline of 16 IPOs scheduled over the next seven months.

The PSX benchmark KSE-100 Index has surged more than 47% this year, making it one of the top-performing markets globally. As market valuations approach long-term averages, experts anticipate a strong comeback for IPOs.

Shahid Ali Habib, CEO of Arif Habib, told Bloomberg that current market conditions, including stable currency and favorable interest rates, are ideal for raising equity. Habib expects to launch up to eight IPOs by June 2026, with companies in the consumer, pharmaceutical, and automotive sectors looking to the stock market to fund expansion plans in anticipation of economic growth.

Meanwhile, Ktrade Securities plans to manage six IPOs in the next six months. Among these are Service Long March Tyres Ltd., aiming to raise up to Rs6.5 billion by April, and Saraaf, a commodity sourcing startup that secured Rs1.5 billion in 2024’s Shark Tank. Additionally, Matco Foods Ltd. intends to spin off its Falak Foods unit.

Omar Salah Ahmed, managing director at Ktrade, said, “Valuations are becoming attractive for sponsors to actually consider listing their entities,” suggesting that 2026 is poised to be a record year for IPOs.

Despite the strong performance of the KSE-100, which has surged over 300% in three years, analysts warn of signs of overheating, with the index trading at nearly 8x forward earnings, above the long-term average of about 6.4x.

Bloomberg also noted that foreign investors have been net sellers at the PSX for nine of the past 11 years, pulling $321 million out of Pakistan in 2025, the largest outflow since 2021.