PSX releases term sheet for 10-year fixed rate GoP Ijarah Sukuk

June 23, 2025 (MLN): The Pakistan Stock Exchange (PSX) has issued the term sheet for the 10-Year Fixed Rate of Return (FRR) Zero-Coupon Government of Pakistan (GoP) Ijarah Sukuk, following the revised auction notice dated June 20, 2025.

The Sukuk will be issued by Pakistan Domestic Sukuk Company Limited (PDSCL), a wholly owned subsidiary of the Ministry of Finance, with a target size of Rs25 billion.

The issue date is set for June 26, 2025, and maturity will be on June 26, 2035, according to the notification issued by PSX.

Structured on Shariah-compliant Ijarah (sale and lease-back), the instrument is designed as a zero-coupon security, offering returns in the form of the difference between face value and discounted investment value, with full redemption at face value on maturity.

Investors will bid based on face value, starting from Rs5,000 or multiples thereof.

The cut-off price will be determined by the Ministry of Finance, and only bids at or above the cut-off will be accepted.

All successful bids will be allotted at the cut-off price using a single price auction methodology.

The Ijarah rental (profit) for each Sukuk equals the difference between its face value and investment value and will remain fixed over the 10-year tenor.

The instrument is 100% eligible for Statutory Liquidity Requirement (SLR) compliance.

Each Sukuk represents an undivided ownership share in the Ijarah asset, with all rights and obligations defined under the approved transaction structure.

According to the Government of Pakistan Sukuk Rules 2008 (amended 2023) and SRO 1585(I)/2023, a broad spectrum of investors is eligible to participate in the auction.

This includes individuals, institutional investors, funds, banks, non-banking financial companies (NBFCs), insurers, and Takaful operators.

Additionally, Roshan Digital Account (RDA) holders, non-resident Pakistanis, foreign investors, and international Islamic financial institutions are also eligible.

All clearing members of the National Clearing Company of Pakistan Limited (NCCPL) may participate, and investors have the option to submit Non-Competitive Bids (NCBs), which are capped at 0.25% of the auction target or Rs500 million, whichever is lower.

Legal advisory is provided by Ahmed & Qazi Advocates, while NCCPL acts as the paying agent, and CDC Share Registrar Services as registrar and custodian.

All Sukuk will be maintained in book-entry form in the Central Depository System (CDS) of CDC. 

The Sukuk is governed by Pakistani laws, in accordance with Shariah principles.

The full transaction structure, Shariah approval, and risk disclosures are published separately and must be reviewed by potential investors.

The issuer has also committed to indemnify advisors except in cases of gross negligence or misconduct.

In case of disputes, resolution will be sought by mutual consent or through the courts of Pakistan.

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