The initial public offering (IPO) of Pak-Qatar General Takaful Limited (PQGTL) entered its book-building phase on Wednesday, with bidding to continue until tomorrow, according to the prospectus released by Arif Habib Limited.

This marks a key step as the Shariah-compliant insurer moves closer to listing on the Pakistan Stock Exchange (PSX).

PQGTL is the “leading dedicated Takaful operator in Pakistan and has 19 per cent of the market share in this segment,” according to Shaid Ali Habib, CEO of Arif Habib Limited.

“This will be the first general takaful operator in Pakistan in the listed space,” he noted.

PQGTL is offering a total of 30 million ordinary shares, 29.67 pc of its post-IPO paid-up capital. Of the 30m shares, 22.5m (75pc) are being offered through the book-building process, while 7.5m (25pc) will be allocated through a subsequent public subscription, according to the prospectus.

The book-building portion is being offered at a floor price of Rs10 per share, with a maximum price band of 40pc. Bids up to Rs14 per share will be allowed.

The final strike price of PQGTL will be determined at a price point where demand fully subscribes to the book-building portion. This will be done through the Dutch auction method, and this price will be carried into the public subscription.

The minimum bid size is Rs2m. Eligible investors in the book-building process include securities brokers, mutual funds, scheduled banks, development finance institutions, insurance companies, pension and provident funds, and foreign institutional investors, provided they are clearing members of the NCCPL.

Trading-only brokers are also permitted to participate under specific arrangements. These investors will be allowed to revise their bids upwards during the process in accordance with regulatory limits, while withdrawals will not be permitted under the Public Offering.

The retail portion will be fully underwritten by Arif Habib Limited, which is the consultant and lead manager of the issue. The public subscription is scheduled for January 28-29, through electronic platforms such as the PSX e-IPO system and the CDC’s Centralised e-IPO System.

At the floor price, PQGTL is expected to raise Rs300m, while a full subscription at the cap price of Rs14 would raise Rs420m.

These proceeds will be used to facilitate the “current expansion of the company,” including “software, acquisition of hardware, branch expansion, and improving the performance of existing branches,” according to Habib.