The Pakistan Stock Exchange (PSX) maintained its bullish momentum on Wednesday, driven by strong institutional liquidity, remittance incentive payouts, and positive investor sentiment, particularly in the oil and gas sector.
The benchmark KSE-100 Index surged to an intraday high of 144,285.74 points, marking a gain of 1,248.58 points, or 0.87%. The index’s low for the day was 143,409.59, still up by 372.43 points, or 0.26%, from its previous close of 143,037.16.
Ahfaz Mustafa, CEO of Ismail Iqbal Securities, noted, “There’s been a flurry of good news and the index has broken out from technical resistance of 140. This has induced a fresh wave of buying especially in the oil sector (due to payments to OGDCL).”
Government Approves Remittance Incentive Payouts
The government has approved Rs30 billion to clear the backlog of outstanding claims under the Telegraphic Transfer Charges Incentives Scheme (TTCIS), which incentivizes remittance inflows. The TTCIS, initiated in 1985, provides a zero-cost model for eligible remittance transactions. The backlog, caused by a surge in home remittances, will now be settled in phases through technical supplementary grants.
OGDCL Receives Circular Debt Payment
Oil and Gas Development Company Ltd (OGDCL) confirmed it received the first interest payment of Rs7.7 billion from Power Holding Private Ltd (PHPL) as part of a long-delayed Rs132.7 billion circular debt settlement. The repayment is linked to term finance certificates (TFCs) issued in 2013, with future interest payments scheduled through mid-2026. OGDCL had previously recognized the interest income over the TFCs’ lifecycle and had a carrying value of Rs170 billion as of March 2024.
SBP Plans Government Borrowing
According to the auction calendar issued by the State Bank of Pakistan (SBP), the government plans to borrow Rs6.175 trillion from commercial banks between August and October. This includes Rs3.675 trillion in Treasury bills and Rs2.5 trillion in fixed and floating-rate Pakistan Investment Bonds (PIBs). This strategy is designed to pre-fund budgetary needs and aligns with IMF commitments to avoid central bank borrowing. The SBP maintained its benchmark interest rate at 11% last week due to renewed inflation concerns, having reduced the policy rate by 1,100 basis points since June 2024.
