Islamabad, May 13, 2025: Despite a surge in stock split announcements at the Pakistan Stock Exchange (PSX) this year, only three listed companies have seen a net positive return, raising questions about the overall impact of these moves on investor confidence and market sentiment.
According to market data shared by Arif Habib Limited on X (formerly Twitter), seven companies initiated stock splits in 2024 with the intent to boost liquidity and attract a broader investor base. These include:
- Arif Habib Corporation Limited (PSX: AHCL) – 10-for-1 split
- Lucky Cement (PSX: LUCK) – 5-for-1 split
- Intermarket Securities Limited (PSX: IMS) – 10-for-1 split
- Systems Limited (PSX: SYS) – 5-for-1 split
- United Bank Limited (PSX: UBL) – 2-for-1 split
- Thatta Cement Company Limited (PSX: THCCL) – 5-for-1 split
- Lucky Core Industries Limited (PSX: LCI) – 5-for-1 split
Among them, only Arif Habib Corporation, Lucky Cement, and United Bank Limited showed post-split price appreciation.
AHCL led the pack with an impressive 36.1% rise since its announcement, followed by LUCK with an 18.7% uptick. UBL saw a smaller, yet positive, gain of 4.6%.
The remaining four firms witnessed stagnant or negative returns, reflecting a mixed investor response.
Financial analysts highlight that while stock splits are designed to make shares more affordable and increase retail participation, they don’t inherently add value unless backed by strong fundamentals and future growth prospects.
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“Splits only work when the market perceives long-term performance potential. Otherwise, it’s just window dressing,” commented one market strategist.
This trend echoes global market behavior, where stock splits often see an initial hype but only sustain value if supported by company performance. For example, Apple and Nvidia saw tremendous success post-split due to strong earnings and investor confidence.
Will Pakistan’s listed companies follow a similar path or fall short of expectations?
Investors and traders should closely monitor post-split earnings reports and sector dynamics before jumping in.
