FAQ's - GEM Board

The Growth Enterprise Market (GEM) Board at the Pakistan Stock Exchange (PSX) is designed primarily for Growth Companies. Growth Companies are comparatively exposed to higher investment risk including liquidity risk as compared to the companies listed at the Main Board. Therefore, only Accredited Investors are allowed to participate in GEM listings.

A Prospectus is created for issue of shares to the general public and is approved by the Pakistan Stock Exchange and Securities & Exchange Commission of Pakistan. An IM is prepared only for Accredited Investors and is not approved by any regulatory body.

The minimum ticket size or the minimum investment amount would be the product of the minimum number of shares that may be subscribed by an investor and the issue price.

The minimum number of shares that may be subscribed are 500 shares, and the issue price varies depending upon the issuer. i.e.

= (Minimum number of shares that may be subscribed by an investor) * (Issue Price)

= (500) * (Varies on case to case basis)

For this Issue, the minimum subscription amount is PKR 32,500/- i.e. 500 shares (minimum shares) * PKR 65 (Issue Price)

Shares will be allocated to successful Accredited Investor in the manner mentioned below:

1. Share application of 500 shares will be allotted first; after all successful application of 500 shares are allotted;
2. Share application of 1,000 shares will be allotted second; after all successful application of 500 and 1,000 shares are allotted;
3. Share application of 1,500 shares will be allotted third; after all successful application of 500, 1,000 and 1,500 shares are allotted;
4. Share application of 2,000 shares will be allotted.

For application of more than 2,000 shares will be allotted in pro-rata basis.

A standardized Subscription Form has been prescribed by the Issuer and is available on websites of the Issuer, Exchange, Central Depositary Company and Joint Advisors to the Issue.

Those Accredited Investors who are interested to participate can submit their forms in person or through their representatives at the designated Bank(s), along with a pay order in favor of the Issuer (i.e. “Universal Network Systems Limited – Subscription Account” equal to the subscription amount (number of shares * issue price).

Investors can also subscribe to shares through the PSX and CDC’s Electronic Initial Offering Service

The Subscription Form can be submitted only during the Subscription Period prescribed by the Issuer. The subscription of shares shall remain open for two (02) working days i.e. November 17, 2021 and November 18, 2021 between 9:00 AM to 5:00 PM.

For accredited Investors applying via either PSX’s or CDC’s Electronic Service can submit application till midnight.

Upon close of the Subscription Period and in case of oversubscription, the allocation of shares will be made on pro-rata basis. The Issuer will be required to finalize the allocation within three (03) working day of the close of Subscription Period and communicate the same to the Accredited Investors.

Allotted shares will be credited in the CDS Accounts of successful applicants.

Any refund (if required) will be made to the Accredited Investors within five (05) working days of the close of Subscription Period.

Accredited Investors who do not have CDC account or sub account with any of the TREC holder, can still subscribe for shares in Initial Offering and can later open trading account and move shares from Investor Facilitation Account to his/her trading account.

The Main Board requires:

1. a minimum post issue paid-up capital of PKR 200 million
2. the issuer to have a profitable track record for at least 2 preceding financial years from its core business activities
3. a full Prospectus to be issued
4. full compliance with Listed Companies (Code of Corporate Governance) Regulations, 2019 (CCG)
5. participation from the general public

On the other hand, the GEM Board requires:

1. a minimum post issue paid-up capital of PKR 25 million
2. no track record of profitability
3. only an Information Memorandum to be issued
4. compliance with CCG only as approved by SECP
5. participation only by Accredited Investors

Only Accredited Investors can participate in the trading of a GEM board listed company. Investor need to inform the broker to be classified as Accredited Investor.

The Issuer may migrate to the Main Board of PSX after fulfilling criteria prescribed in Chapter 5 of PSX Rule Book including:

1. i. Minimum post issue paid up capital of PKR 200 million
2. ii. Complete compliance with Listed Companies (Code of Corporate Governance) Regulations, 2019