Karachi: The Universal Insurance Company Limited has announced the issuance of right shares, aimed at meeting the minimum paid-up capital requirements outlined by the Securities and Exchange Commission of Pakistan (SECP) for non-life insurers according to the Insurance Rules, 2017. The report, dated October 27, 2026, outlines the strategic objectives and financial implications of this corporate action.
The primary purpose of the right issue is to comply with the SECP’s revised paid-up capital requirements, as stipulated in S.R.O No. 310(I)/2025, dated March 3, 2025. The company plans to leverage the proceeds to enhance its capital reserves, which will facilitate securing more favorable reinsurance terms, increase underwriting capacity, and bolster solvency and financial stability. Furthermore, the funds will support the company's working capital needs, ensuring the continuity of operations and supporting future business growth. The proceeds might also be strategically invested to generate enhanced returns, contributing to long-term profitability and growth prospects.
Funding for the right issue will be sourced from the subscription proceeds of existing shareholders, aligned with their current shareholding proportions, as approved by the Board of Directors and disclosed to the Pakistan Stock Exchange. The designated market category for the company is non-life insurance. The right issue proceeds will be deposited in a monitored bank account to ensure adherence to governance standards, with oversight by the Audit Committee.
According to information available from the Pakistan Stock Exchange (PSX), the net asset or breakup value per share is expected to decrease by 16.71% post-issue, from PKR 15.02 to PKR 12.51. The issuance will result in a substantial increase in paid-up capital, which will rise by 100.00%, from PKR 500 million to PKR 1,000 million, reflecting a very large or significant move. However, the market share remains unchanged at 0.03%.
Commitments from substantial shareholders and directors underscore the confidence in the company's strategic direction. Bibojee Services (Pvt.) Ltd., an associated company, along with directors such as Lt. Gen. (Retd.) Ali Kuli Khan Khattak, Dr. Shahin Kuli Khan Khattak, and others, have committed to subscribing to the right shares in proportion to their existing holdings. The total number of shares committed to be subscribed is 43,750,028, amounting to PKR 437.50 million, which constitutes 87.5001% of the company's shareholding both pre- and post-issuance.
The issuance of right shares is a strategic move by the Universal Insurance Company Limited to not only comply with regulatory requirements but also to position itself for sustained growth and improved operational resilience in the competitive insurance sector.