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Pakistan’s largest Islamic insurer, Pak-Qatar Family Takaful Limited, is preparing to make history with its upcoming initial public offering scheduled for mid-December. The company aims to raise approximately Rs1.1 billion ($3.9 million) in what will be the first listing of a dedicated family takaful operator on the Pakistan Stock Exchange.

According to a company statement released Friday, the registration process will commence on December 8, with the book-building phase set for December 11-12. The offering represents a significant milestone for Pakistan’s insurance sector, which has traditionally struggled with low market penetration compared to global standards.

Pak-Qatar Family Takaful will offer 50 million shares to investors, with a floor price of Rs14 ($0.05) and a ceiling of Rs21 ($0.07) per share. The offering structure allocates 75 percent of shares (37.5 million) to institutional investors, while the remaining 25 percent (12.5 million shares) will be available to retail investors and the general public.

Shahid Ali Habib of Arif Habib Ltd., the lead manager for the IPO, reported strong investor interest in the offering, highlighting its pioneering status within Pakistan’s Islamic insurance sector. The company plans to use the proceeds to meet regulatory capital requirements, develop new Shariah-compliant insurance products, and accelerate its digital transformation initiatives to reach more customers.

Established as the country’s first dedicated Shariah-compliant family risk protection provider, Pak-Qatar Family Takaful has built a dominant market position, currently holding 44 percent of Pakistan’s total family takaful market. In the fully dedicated segment, the company commands over 90 percent market share. The insurer maintains a substantial nationwide footprint with 73 branches and a network of nearly 2,000 field representatives across Pakistan.

The IPO comes at a time when Pakistan’s insurance landscape shows significant growth potential. Despite being the world’s fifth most populous nation, insurance penetration in Pakistan remains remarkably low at just 0.7 percent as of 2024. This figure stands in stark contrast to developed markets where insurance penetration routinely exceeds 10 percent of GDP.

Takaful, the Islamic alternative to conventional insurance, operates on principles of mutual protection and shared responsibility. Unlike traditional insurance models, takaful prohibits interest (riba), excessive uncertainty (gharar), and gambling (maysir), making it compliant with Islamic financial principles. Participants contribute to a pool that provides compensation to members who suffer losses, with any surplus distributed among participants or reinvested.

Pakistan’s Islamic finance sector has shown resilience even amid broader economic challenges, with takaful growing steadily in recent years. The country’s large Muslim population of over 230 million represents a vast untapped market for Shariah-compliant financial products, including Islamic insurance solutions.

Analysts suggest the listing could catalyze further development in Pakistan’s nascent Islamic insurance sector by improving transparency, enhancing corporate governance, and providing a benchmark for valuation. The IPO may also encourage other takaful operators to consider public listings, potentially bringing more capital into the industry.

For investors, the offering presents an opportunity to gain exposure to Pakistan’s underpenetrated insurance market through a company with established market leadership in the Islamic insurance segment. The listing also diversifies the types of financial institutions available on the Pakistan Stock Exchange, which has traditionally been dominated by conventional banks and industrial companies.

The Pak-Qatar Family Takaful IPO underscores the ongoing evolution of Pakistan’s financial markets and highlights the growing significance of Islamic finance in the country’s economic landscape.