Soya Supreme, a prominent player in Pakistan’s cooking oil manufacturing sector, has announced its intention to launch an initial public offering (IPO), as revealed by company officials on Friday. This strategic move aims to propel Soya Supreme into new markets in the Middle East and North Africa.

This development represents the second IPO in a turbulent year for the Pakistan Stock Exchange (PSX), which has grappled with economic uncertainty and political dynamics in anticipation of an upcoming general election scheduled for the end of November. The persistently high interest rates have further complicated the financial landscape.

In 2022, only three companies went public on the PSX, collectively raising 1.3 billion rupees ($4.3 million), marking the lowest figure recorded in nine years.

Soya Supreme, founded in 1991, maintains flexibility regarding the timing of the IPO, with the decision contingent on prevailing market conditions. Ahmad Ghulam Hussain, the CEO of Agro Processors & Atmospheric Gases (APAG), the parent company of Soya Supreme, shared this insight in an exclusive conversation with Reuters.

Hussain elaborated, saying, “The board has empowered the management to engage HBL and KTrade in initiating the IPO process.” HBL, a local bank, and KTrade, a brokerage firm, have been entrusted with this critical task.

While the specific details of the fundraising target and company valuation remain confidential, Hussain emphasized that these aspects would be subject to approval by the board. He also confirmed that the IPO would not involve the sale of existing shares.

It is noteworthy that Pakistani manufacturers predominantly rely on imported raw materials, with soybean and palm oil imports totaling $3.7 billion in 2022. The Pakistan Vanaspati Manufacturer’s Association reported the production of 3.7 million to 4 million tonnes of oils and fats during the same year.

Soya Supreme recently diversified its product portfolio by venturing into specialized industrial fats, addressing the local food industry’s needs amidst import restrictions within Pakistan. Furthermore, the company has explored export opportunities for these specialized fats in the Middle East and North Africa, expanding its product offerings beyond cooking oils to include a range of sauces.

In addition to Soya Supremes’ plans, Dalda, Pakistan’s largest consumer staple company, has disclosed its intention to go public this year, aiming to raise between 3.3 to 4.6 billion rupees. If it successfully achieves the higher target of 4.6 billion rupees, Dalda’s IPO would be the largest among consumer staple companies in the country. However, specific launch dates for Dalda’s IPO are yet to be announced.