Karachi: Alhamra Smart Portfolio has reported a resilient performance for the quarter ending September 30, 2024, amid challenging economic conditions and substantial market shifts.

The Pakistani economy saw a cautious yet optimistic quarter as the government secured a staff-level agreement with the International Monetary Fund (IMF) for a PKR7.0 billion Extended Fund Facility (EFF), although official approval faced delays. According to information available from the Pakistan Stock Exchange (PSX), the initial disbursement of PKR1.0 billion under the EFF bolstered Pakistan’s foreign exchange reserves, aiding a mild appreciation of 0.2% in the USD/PKR exchange rate.

The country's current account deficit in the first two months of fiscal year 2025 stood at PKR17 million, a significant reduction from the PKR893 million recorded in the same period of the previous year. This improvement was primarily driven by a substantial 44.0% increase in export flows, reaching PKR1.8 billion. Despite the challenges, the State Bank of Pakistan’s reserves swelled to PKR10.7 billion as of September 2024, supported by various international financial inflows.

Pakistan's Gross Domestic Product (GDP) showed signs of recovery, growing by 2.5% compared to a decline of 0.2% last year. The agriculture sector grew by 6.4%, and services expanded by 2.2%, but industrial output remained subdued due to inflation and political uncertainties. On the fiscal side, the Federal Board of Revenue (FBR) collected PKR 2,556 billion, falling short of the target by PKR 96 billion.

The equity markets responded positively, with the KSE-100 Index climbing to a new all-time high of 82,247 points, although it later adjusted to 81,114 points by quarter-end, marking a 3.4% increase. The mutual fund industry saw a 13.9% growth in net assets, with money market funds leading at 44.7% of the segment share.

As the quarter concluded, the economic outlook remained cautiously optimistic with projections of GDP growth up to 2.8% in FY25. The external sector's improvements, bolstered by the IMF program and controlled inflation, are expected to stabilize the financial landscape further.