FEDERATION OF EURO-ASIAN STOCK EXCHANGES
ANNUAL REPORT APRIL 2009
LAHORE STOCK EXCHANGE
The crisis in Pakistan’s economy has now
eased as the government addressed the
most immediate risks, and entered into a
stabilization program with the IMF.
Mian Shakeel Aslam
Acting Managing Director
The market remained bearish during the year
2008. Challenging economic condition,
unstable political conditions, higher inflation
and interest rates, exchange-rate instability,
stagnation of the privatization process, outflow
of the portfolio investments, globally pervasive
bearish markets, energy crisis, worsening law
& order situation, political uncertainties,
depletion of foreign-exchange reserves,
lowering of country’s credit-rating etc. are the
main factors for continuation of this bearish
spell. The sense of crisis gripping Pakistan’s
economy has now visibly eased as the
government moved to address the most
immediate risks, and entered into a
macroeconomic stabilization program to
support medium-term reforms under the aegis
of the IMF.
LSE-25 Index after touching the height of
4,841.660 points in February 2008 started to
decline sharply and is placed at 1,491.940
points on December 31, 2008 with market
capitalization of US$ 21.416 billion. The
average daily turnover of shares remained
12.476 million shares with an average daily
value of shares traded of US$ 18.418 million.
LSE listed 1 new company 7 Open-end Mutual
Fund and 3 Term Finance Certificates during
the period under review. The overall economic
scenario has not been conducive for
companies to list and for the investors to
trade in the stock exchange. The Exchange is,
however, well positioned in an enabling
environment with the cooperation of the
regulators to capitalize all available
opportunities with its distinct performance
to restore the confidence of investors and
to tap the potential listing opportunities.
HISTORY AND DEVELOPMENT FUTURE OUTLOOK
Lahore Stock Exchange (LSE) was
incorporated on 05 October 1970 in Lahore,
the provincial capital of Punjab, Pakistan,
under the Securities and Exchange Ordinance
in 1969, as a company limited by guarantee.
The activities of the Exchange have increased
in all areas since inception. LSE introduced
automated trading in 1996 and became the
first fully automated Stock Exchange of
Pakistan. LSE has become a key institution in
the financial sector of Pakistan and has a
membership of 152 brokerage houses. As of
December 31, 2008 there were 512 listed
companies, having a listed Capital of US$
8.798 billion with a market capitalization of US$
21.416 billion, besides 34 Open-end Funds
and 12 Term Finance Certificates (corporate
debt instruments) of companies are also listed
at LSE. • Continue with its strategy of increasing its
geographical outreach through the use of
information technology in order to attract
higher trading volumes
• Introduce trading in the derivatives market
Sector Index Futures, TFC’s etc.
• Introduce Market BrokerNet - Broker hosted
Internet Stock Trading Solution
• Promote and market indigenously developed
trading software i.e. Ultra Trade and related
systems to other stock exchanges
• Build a Disaster Recovery site for the
continuity of services in case of any disaster
• Strengthen the surveillance function of the
Exchange
• Commence with creating a dedicated R&D
and product development section to cater new
business needs
• Deploy ERP to get efficiency and reliability in
internal processes
• Demutalize the Exchange
The Exchange is fully committed to providing a
transparent, efficient, fair and investor friendly
environment for the benefit of investors and
issuers. The goal is to bring LSE up to
international standards in operational,
technical, regulatory and quality management
areas and to ensure that not only domestic but
also foreign investors are attracted to the
Exchange for the development of the country.
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LSE is expeditiously working on its
demutualization which will have a major role to
play in the overall reformation of the capital
market of Pakistan and through its successful
implementation will enhance governance
standards and transparency and ultimately
investor’s confidence.
During the year LSE sold in-house develop
trading software “Ultra Trade” to Ghana Stock
Exchange. The Exchange is also in the phase
of evaluating content management software. It
would be deployed in all departments of LSE
in order to improve efficiency, performance,
coordination, transparency and also
encourage the concept of paperless
environment.