Stories about investment

Why the time to invest in Pakistan is now

Being a capital market participant, I have seen quite a few ups and downs during the past decade. I have experience of evaluating a large number of companies listed at the Pakistan Stock Exchange (PSX). I believe, at this point in time, most of the listed companies are trading well below their fair price, thus, offering good return potential and strong dividend yield. Historically speaking, every time our stock market experienced a downturn, it bounced back with more power. Even though the downturns are often abrupt, recovery usually takes a while. Nonetheless, once our stock market comes out of crisis, ...

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No, Pakistani ‘startups’ did not raise over $300 million in investments in 2018 

A Pakistani tech publication published an article recently, claiming that Pakistani startups raised $341 million in 2018. This article was shared by many in the Pakistani startup ecosystem. The article was perhaps seen as an acknowledgment of the fact that the technological ecosystem in Pakistan has come a long way and is finally attracting venture capital (VC) money. This might very well be true. But the claim that Pakistani startups raised over $300 million last year is a stretch. For any such report, it is very important to first define a few basics and focus on their respective methodologies. These basics include: the definition of ...

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Let’s talk about Pakistan’s spiralling circular debt

Power-sector circular debt has become a subject of hot discussion as the media bandies the government’s efforts in securing emergency finance from external sources. Although various explanations of the cause and potential solutions to this crisis have been published in academic circles, very little of this has been understood by the population of Pakistan. Unsurprisingly, none of the discourse has translated into action at the policy level. Circular debt At its core, circular debt is the state’s outstanding financial obligations to Independent Power Producers (IPPs) for supplied power, and to vendors for fuel consumed by state-owned power plants. The problem For decades, the ...

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Who will invest in Pakistan if its head of state constantly highlights its corruption and desperation?

Prime Minister Imran Khan, after taking oath, has so far been on six foreign trips despite initially stating that he would not go on any foreign trips for the first three months. Perhaps given the economic dire circumstances, these trips were inevitable. The extent of success of these trips, with respect to obtaining economic aid and attracting investment, is still being debated in the national media. However, another thing which is under discussion is the way prime minister conducted himself on these trips. Like all rulers, Imran has also tried to market Pakistan by pointing towards its large young population, ...

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Is China making Pakistan a client-state with its ‘debt-book diplomacy’?

In Pakistan, China is the most active and positive economic force. So much so that continued cooperation between the two countries is supported by virtually all sides of this otherwise deeply divided country. Everyone from the Taliban to the secularist military leaders view Chinese investment as a boon to the country, the main source of job creation, and, in all truth, the most promising source of kickbacks for themselves. It certainly is the case that the infrastructure projects part of China’s One Belt One Road (OBOR) initiative are the most significant economic development stimulus in the economically underdeveloped country, and the ...

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Bitcoin, the magic money, and why I chose to risk it for the biscuit

The Bitcoin saga has been one of mad fanfare, terminological jargon, ridiculous price jumps, and scathing criticism from banking establishments. There is a plethora of information available on how Bitcoin works, and the original proof-of-work paper is available to read on the currency’s organisational website. Yet, despite all the countless articles that detail the schematics of the Bitcoin system, it remains mired in controversy, especially of late as it makes the news on a regular basis for its volatility. Let’s take a look at some of the myths surrounding Bitcoin, and attempt to disentangle this nascent cryptocurrency from the confusion that surrounds ...

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How the twin-marches in Islamabad are affecting our economy

Bang! The first bullet shot in Model Town echoed through the streets of Lahore. We may never know what was going through the mind of the man who pulled that trigger or through the mind of the one who authorised it, but what followed was one of the most dramatic domino effects in the country’s recent history. Although Imran Khan will probably insist that it also has something to do with election rigging. Tahirul Qadri’s second coming, the twin marches on Independence Day and the sit-ins since then, resignations in the assemblies, the march into the Red Zone, the use of force by the government as ...

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What will happen to the stock market if the PM resigns?

In 2007, I underwent a six-hour-long marathon panel interview at the London office of one of the (then) largest hedge funds in Europe called XYZ Capital*. A senior partner – perhaps a PhD holder – drew the entire map of the Middle East, East Asia and Europe, and tested my knowledge about the current affairs of each country turn by turn. After a gruelling session, the partner remarked, “An investor may have the best of quantitative minds but markets don’t make sense if the political factors don’t make sense.” I engraved it then but have only felt it now. Surviving through the minor speed breakers ...

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Walter Isaacson’s ‘Steve Jobs’: The definition of perfectionism

Did you know that Xerox was the first company to invent the three-button mouse and use a Graphical User Interface (GUI)? Also, to add on to your knowledge, the original design for Mac in 1984 was inspired by Tiffany, Cuisine Art, Sony and Porches and Bill Gates, who made an investment worth $150 million in Apple to help it avoid going bankrupt. You will find all these facts and a lot more in Walter Isaacson’s Steve Jobs. After Benjamin Franklin: An American Life and Einstein: His Life and Universe, Steve Jobs is Isaacson’s third biography, based on 40 interviews conducted during Apple Inc.’s cofounder’s severe cancer ...

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Pakistan’s Stock Market: A lost investment opportunity?

The phrase ‘stock market’ has a charm around it, which grabs the attention of almost any listener anywhere in the world. In Pakistan, however, it portrays a picture of an exclusive club for the aristocrats who bet their easily earned fortunes in the corporate bazaar. However, perceptions are often incorrect and the same is the case with the Pakistan’s stock markets, where the consequences usually involve lost opportunities to rake in money. A recently published report in The Economist concluded that the proportion of capital to labour is rising in developing economies. Simply put, to employ your human capital, as an entrepreneur, provides more financial ...

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