ISLAMABAD: Pakistan will be eligible for inclusion in the Frontier Markets 100 index and the Frontier Markets 15% Country Capped Index in May 2022.
Morgan Stanley Capital International (MSCI) today announced this development which was cheered by the investors and stock market traders.
“After a feedback received from the market participants, Pakistan will become eligible for inclusion in the MSCI Frontier Markets 100 and the MSCI Frontier Markets 15% Country Capped indexes as part of the May 2022 Semi-Annual Index Review (SAIR),” a statement issued by MSCI to Pakistan Stock Exchange said.
In Sept 2021, the MSCI officials started discussions with investors pertaining to Pakistan’s inclusion in the Frontier Markets 100 Index.
Pakistani stock market experts believe that Lucky Cement, Hub Power Company, Engro Corporation, HBL, UBL, MCB, Fauji Fertiliser, Systems Limited, Mari Petroleum, Engro Fertilisers, and Pakistan Petroleum Limited can be part of the MSCI FM 100 Index in 2022.
Meanwhile, analysts said Pakistan could receive foreign inflows of $75-95 million in May 2022 as a result of MSCI’s review. Pakistan is estimated to have a 3.64% weighting in the MSCI FM 100 Index.
MSCI downgraded Pakistan to a frontier market in September, four years after it was upgraded to an emerging market.
However, the decision increased Pakistan’s weighting in the MSCI Frontier Markets Index to 2.3%. Additionally, funds increased their Pakistan holdings to 10% within a year. The MSCI Pakistan Index has a weight of 1.28% when compared to the other three components of the MSCI Frontier Markets Index.
