Pakistan Stock Market Among World's Best Performers in 2024

[Riaz Haq]

Pakistan's KSE-100 index soared 86% in 2024, making it the second best among major indexes, according to Bloomberg News. The 2024 performance of KSE-100 represents its best year since 2002 when it shot up 112%. The top 3 performing stock markets in 2024 were Argentina (114%), Pakistan (88%) and Kenya (79%), according to Topline Securities. The US markets posted double digit gains with the AI-driven tech-heavy NASDAQ-100 up 27.6%. Small and medium US companies performed well with the Russell 2000 Index edging out India's Sensex with an 8.9% return.  

Pakistan Among Top Performing Stock Markets in 2024. Source: Bloomberg

Clearly, the $7 billion IMF program helped restore some investor confidence in Pakistan's economy in 2024. It was also boosted by remittances from overseas Pakistanis in  July-October 2024 which soared nearly 35% YoY to $11.8 billion as compared to $8.8 billion in July-Oct 2023. The fact that the KSE100 shares valuations relative to earnings still remain at historic lows (PE ratio of just 5.9) is an indication that investors have doubts about the sustainability of the economic improvements in the country. Among the top investor concerns appear to be worsening internal security situation and rising political instability. 

History of Pakistan's KSE-100 Returns Since 1995. Source: Bloomberg

Pakistan's macroeconomic indicators have significantly improved in 2024. Inflation has come down dramatically, from 29.7% in December 2023 to 4.1% in December 2024, resulting in aggressive monetary easing of 900 bps by the State Bank of Pakistan (SBP). The current account deficit has turned into a surplus of $729 million in November 2024 and the currency has remained stable.  In spite of the run-up, the KSE-100 2025 forward PE ratio of 5.9x is still substantially below the 10-year average P/E of 8.2x. 

Pakistan Shares Index PE Ratio. Source: Arif Habib

Pakistan's exports grew to $16.56 billion, an increase of 10.52% in July-Dec period in 2024 over the same period in 2023, while  imports grew 6.11% to $27.73 billion in this period. Pakistan's textile exports grew 9.7% in the first six months of the current fiscal year. The trade deficit in July-December FY25 increased 0.18% to $11.17 billion from $11.15 billion over the prior year. In December, the deficit jumped 34.80% to $2.44 billion from $1.82 billion in December 2023. The trade gap contracted to $24.08 billion in FY24 from $27.47 billion in the preceding year. The current account improvement was helped by remittances from overseas Pakistanis in  July-October 2024 which soared nearly 35% YoY to $11.8 billion as compared to $8.8 billion in July-Oct 2023.

Pakistan Textile Exports. Source: Arif Habib

In 2024, Pakistan began to make some progress to resolve the economic impact of high electricity rates and rising debt (PKR 2.1 trillion) owed to the independent power producers (IPPs). While the government terminated or renegotiated power purchase contracts (PPAs) with some IPPs, the consumers took matters into their own hands and started an unprecedented solar energy revolution. 

As a result of the latest round, PPAs with five IPPs were terminated as a first step. Two of the five IPPs took haircut deals, accepting a discount of up to PKR 20 billion. 18 other IPPs face possible conversion to take-and-pay contracts, whereby the state-owned off-taker will only be liable to pay for energy consumed by the grid, eliminating capacity charges, according to a report by the Institute for Energy Economics and Financial Analysis. 

Pakistan Solar Projects Seen From Satellites. Source: Atlas Via Blo...

High power prices are fueling a massive solar buildout across Pakistan, according to a Yale360 report. Solar imports from China so far this year have already outstripped imports across all of last year, Bloomberg reports. Panels purchased in 2024 amount to 17 gigawatts of capacity, enough to raise Pakistan's total power capacity by a third. A satellite data analysis done in April by Norwegian firm Atlas revealed around 400 solar plants across the country, clustered mostly in industrial hubs. But many more installations went undetected, the geospatial analysis firm said. Most panels have been deployed almost equally across homes, factories, and farms, solar distributors say. 

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[Riaz Haq]

AKD Securities
@akdsecurities
Pakistan worker remittances increased by 14%YoY to US$3.7bn in May'25

https://x.com/akdsecurities/status/1932759007069884750

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The inflows brought total remittances for July-May FY2024-25 to $34.9 billion, marking a 28.8 percent increase from $27.1 billion in the same period last year. The rise follows a record breaking $4.1 billion in March, the highest-ever single-month inflow, and a robust $3.2 billion in April.

https://www.arabnews.com/node/2604146/pakistan

The strong performance has helped offset Pakistan’s trade deficit and support its fragile foreign exchange reserves amid continued macroeconomic pressure.

“This is the highest level of remittances recorded in recent months,” the SBP said in a statement, noting that the increase reflected stronger flows from key corridors and a growing shift toward formal remittances channels.

Analysts attribute the surge to a combination of factors, including improved exchange rate management, government crackdowns on hawala and hundi informal systems for transferring money internationally, and seasonal flows during Ramadan and Eid.

Saudi Arabia remained the largest contributor in May, sending $913.9 million, followed by the United Arab Emirates ($754.2 million), the United Kingdom ($588.1 million), and the United States ($314.7 million)

[Riaz Haq]

Arif Habib Limited
@ArifHabibLtd
Remittances increased by 27% YoY to USD 38.2bn during FY25 (the highest ever)

Remittances by overseas Pakistani increased by 8% YoY to USD 3.4bn during Jun'25 compared to USD 3.2bn during Jun’24. On MoM basis, remittances decreased by 8%.

In FY25, remittances increased by 27%YoY to USD 38.3bn, highest ever level.

https://x.com/ArifHabibLtd/status/1942854485262430587

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Mohammed Sohail
@sohailkarachi
Record Remittances When Most Needed

In a year marked by economic challenges, overseas workers stepped up:

🇵🇰 *Pakistan* received a record USD 38.3 billion in remittances in FY25 — up 27%
🇧🇩 Bangladesh also saw record inflows of USD 30 billion — up 26%

A big source of support for both economies, helping bridge external gaps and boosting household incomes.

https://x.com/sohailkarachi/status/1942852719619781015

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https://english.news.cn/20250709/50a96ca778634b2b8a3dc7e3c89b6e46/c...

Remittances sent by overseas Pakistani workers rose by 26.6 percent to a record 38.3 billion U.S. dollars in fiscal year 2024-25 (FY25), up from 30.3 billion dollars in FY24, the State Bank of Pakistan said Wednesday.

The sharp rise was driven by higher inflows from key host countries including Saudi Arabia, the United Arab Emirates (UAE), the United Kingdom, and the United States, according to official data.

In June 2025 alone, remittances stood at 3.41 billion dollars, following 3.69 billion in May and 3.18 billion in April.

Saudi Arabia led with 823.2 million dollars in June, followed by the UAE with 717.2 million dollars, the UK with 537.7 million dollars, and the U.S. with 281.2 million dollars.

Significant contributions also came from Gulf Cooperation Council countries such as Qatar and Oman, and European countries including Italy, Spain, and Germany. Italy alone accounted for 129.3 million dollars in June.

Economists say strong remittance inflows will help ease pressure on the external account and bolster Pakistan's foreign exchange reserves.

Remittances remain a key source of external financing for the country. ■

[Riaz Haq]

Abdul Rehman Najam
@AbdulRehman0292
🇵🇰🇵🇰 posts massive current account surplus of $2.1 Billion in FY25, highest in last 22 years.

Current account surplus is no longer due to restricted imports, it is now because of bumper remittances and increased exports. Combined inflows of almost $80 billion in FY25.

$$ reserves have increased to $14 billion from just $3.5Bn two years ago, without any increase in foreign debt ✅✅

https://x.com/AbdulRehman0292/status/1946158062181519815

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Arif Habib Limited
@ArifHabibLtd
Current Account surplus reached USD 2.1bn in FY25

In Jun’25, a current account surplus of USD 328mn was recorded, compared to a deficit of USD 500mn in Jun’24 and a deficit of USD 84mn in May’25.

For the FY25, the country posted a current account surplus of USD 2,106mn, an improvement from the deficit of USD 2,072mn during the same period last year.

https://x.com/ArifHabibLtd/status/1946152600925032628

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SBP
@StateBank_Pak
Current account balance recorded a surplus of US$2.1 billion during FY25 compared to a deficit of US$2.1 billion during FY24.
https://bit.ly/3Ox6ZwI

https://x.com/StateBank_Pak/status/1946156934999966200