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Business environment improving with lucrative investment opportunities in Pakistan

PSX deal with China a major step to implement ‘one belt and one road’ strategy amid help boost CPEC plan

Interview with Syed Ali Raza Bukhari – CEO, Vector Securities (Pvt) Limited

PROFILE:

Syed Ali Raza Bukhari has been associated with the financial sector for more than a decade. Prior to being a part of Vector Securities (Private) Limited (member firm of the Pakistan Stock Exchange), he was associated with the then IGI Funds Limited, National Investment Trust (NIT), ABL Asset Management Company and NBP Fullerton Asset Management Company. Being part of Vector Brand, he has showcased the capital markets on myriad investment forums in Pakistan as well as in the Emirates. He holds an MBA from a prestigious business school of Pakistan.

PAGE: WHAT IS YOUR TAKE ON CHINESE INVESTMENT IN PSX?

SYED ALI RAZA BUKHARI: The investment is a major measure to implement China’s “One Belt and One Road” strategy and boost the construction of China-Pakistan Economic Corridor (CPEC). This strategic collaboration will indeed strengthen its roots in a diversified array of PSX at all corners such as developing multi-tier stocks, bond and derivatives markets, enhancing technological capabilities, improving investor’s cognitive ability and cementing the protection of investors, in a bid to further propel the already robust growth of the Pakistani capital market.

PAGE: WHERE DO YOU SEE PSX MOVING IN NEXT COUPLE OF YEARS?

SYED ALI RAZA BUKHARI: “One Belt and One Road” strategy is indeed poised to bring in robust growth on all fronts in the coming years. The overall momentum is already indicating an upward trend in the market. This synergy will not only bode well for the market depth, but would also help in expanding the breadth of the market by adding new products, technology and investor relations. An exchange that is ranked 4th by the WFE (World Federation of Exchanges) in terms of market capitalization and turnover will definitely have a trickledown effect in times to come.

PAGE: WHICH SECTOR MAY PERFORM WELL ON PSX DUE TO THE FOREIGN STRATEGIC INVESTMENT?

SYED ALI RAZA BUKHARI: When there’s glory there’s glory for all. I personally feel that this synergy will have a positive effect across the board on all sectors albeit more on few than others, but growth will definitely be witnessed across the board. Based on the strategic alliance certain sectors do seem to be of more interest, based on the “One Belt and One Road” strategy. Nonetheless, it won’t be fair to undermine any sector at this stage as our inclusion in the MSCI in May 2017 is an impetus and a cherry on top that cannot be ignored and would steer broad based rally.

PAGE: HOW WOULD YOU COMPARE PSX WITH INDIAN AND CHINESE EXCHANGES?

SYED ALI RAZA BUKHARI: I think let the numbers say it all:

Exchange
Dividend Yield
P/E
Market Capitalization
Listed Companies
Pakistan Stock Exchange
5%
11x
USD 100 Bio
550
Bombay Stock Exchange
1.5%
19x
USD 1,500 Bio
3,000
Shanghai Stock Exchange
2%
15x
USD 4,200 Bio
1,200
*Numbers have been rounded off to the nearest, to give readers a quick snapshot comparison.

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