SECP approves Growth Enterprise Market listing regulations

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has approved the Growth Enterprise Market Listing Regulations to enable Small and Medium Enterprises (SMEs), Greenfield projects and other companies to raise capital through capital markets conveniently, ARY News reported.

According to a press release, the SECP has advised Pakistan Stock Exchange (PSX) to arrange publication of new regulations in the Official Gazette of Pakistan to replace PSX’s existing regulations governing listing and trading of equity securities of SMEs.

The Growth Enterprise Market regulations designed especially to facilitate small enterprises, startups and green field companies that are aspiring to raise funds through capital markets but cannot fulfill the cumbersome conditions for listing on the Main Board of PSX, said a press release.

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Hence, in addition to the main board of PSX, the Growth Enterprise Market (GEM) will be a second board at PSX for listing and trading of equity securities. However, the trading screen for both boards will be same.

The minimal fee for listing on GEM board is Rs50,000, which is significantly low as compare to listing on PSX main Board, where a minimum listing fee is Rs200,000.

Moreover, to facilitate the issuers, any person licensed with the SECP as securities broker or consultant to the issue can act as Advisor, added a press release.

The said board also allows green field project and non-profitable companies to raise funds. Moreover, the companies listed on GEM board may graduate to the main board subject to the fulfillment of prescribed criteria.

In order to create liquidity on the GEM board, the concept of eligible investors has been introduced and the minimum lot size has been linked with the main board of the PSX, which is currently 500 shares.