Degree
Master of Science in Islamic Banking & Finance
Department
Department of Finance
Faculty/ School
School of Business Studies (SBS)
Date of Submission
Spring 2024
Supervisor
Dr. Irum Saba, Associate Professor & Program Director MS-IBF, Institute of Business Administration, Karachi
Keywords
Pakistan Stock Exchange, Karachi Meezan Index (KMI), Sharia Compliance, Islamic Capital Market
Abstract
In this research, the performance of firms listed on the Pakistan Stock Exchange that adhere to Shari'ah law as well as those that do not is being studied. This research will investigate the effect of being compliant on a company’s performance by using the dependent variables i.e. ROA, NPM, EPS, Independent variables i.e. Shariah Compliant Status, Non Shariah Compliant Status micro variables leverage, size of firm, CAPEX and macro variables i.e. GDP & Inflation rate. The quantitative approach will be applied, and the data would be extracted from the Pakistan Stock Exchange data portal and the company’s financial report. The sample data will be obtained for five years (from January 1st, 2017 to till December 2021). As of 31 December 2021, 403 Companies are listed in PSX, of which 259 companies are SC and the rest of 140 are Non-SC. The primary goal of this study is to compare the performance of companies operating in accordance with Islamic law and those operating as per conventional law that are listed on the PSX. According to the findings, SC enterprises performs well as compared to non-SC firms in terms of profit. It is suggested that the regulator, the SECP, give incentives to Sharia compliant businesses. Furthermore, SECP and PSX should focus on increasing investor awareness of SC products and services in the PSX while also providing incentives such as tariff reductions and capital gains tax exemptions, among other things, to help increase the investor base and promote the Islamic Capital Market in Pakistan.
Document Type
Restricted Access
Submission Type
Research Project
Recommended Citation
Raza, H. (2024). Performance Analysis between Shari’a Compliant and Non-Shari’a-Compliant Companies: Listed in PSX (Unpublished graduate research project). Institute of Business Administration, Pakistan. Retrieved from https://ir.iba.edu.pk/etd-ms-ibf/38
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