In CY25, Pakistan’s equity market posted a strong performance, with the KSE-100 Index gaining ~52% during the year, supported by macroeconomic stabilization and improved investor confidence. The rally was reinforced by continued IMF support under the International Monetary Fund programs, including disbursements of ~USD 1.2bn, while State Bank of Pakistan foreign exchange reserves strengthened to above ~USD 15.8bn by year-end. Ongoing monetary easing, a relatively stable PKR, and resilient remittance inflows further supported liquidity and sentiment, enabling equity funds to capture strong equity upside while fixed-income allocations maintained portfolio stability. Within the Equity Fund category, PACRA rated four out of twenty two funds, with the category’s average return at ~37%. The First Capital Mutual Fund earned a 3-Star ranking, delivering a 1-year return of ~32.84%. As of Dec 2025, the Fund maintained ~89% exposure to equities, ~6.2% in cash, and remaining in other instruments. Major sector allocations included ~19% in Commercial Banks, ~17% in Gas & Exploration Companies, ~10% in Fertilizers, ~7% in Oil & Gas Marketing Companies and ~9% in Cements, with ~27% spread across other sectors. The Fund's strategy focused on balancing growth and liquidity, helping it navigates short-term volatility while capturing long-term upside.

Over the past three years, Pakistan’s market navigated persistent inflationary pressures, sharp currency depreciation, external financing constraints, and prolonged political uncertainty, alongside a consistently high interest rate environment; despite these macro headwinds, the KSE-100 Index delivered cumulative gains of roughly ~263% across three years, supported by stabilization under the IMF program, gradual monetary easing, strengthening foreign exchange reserves, improving current account dynamics, and resilient corporate profitability, positioning Pakistan among the top-performing frontier markets during this period. Despite this, Equity category showed resilience, with the average return at ~249%. First Capital Mutual Fund received a 3-Star ranking, posting a return of ~227%. As of Dec 2025, the Fund maintained ~89% exposure to equities, ~6.2% in cash, and remaining in other instruments. Major sector allocations included ~19% in Commercial Banks, ~17% in Gas & Exploration Companies, ~10% in Fertilizers, ~7% in Oil & Gas Marketing Companies and ~9% in Cements, with ~27% spread across other sectors. The Fund's strategy focused on balancing growth and liquidity, helping it navigates short-term volatility while capturing long-term upside.

Over five years, Pakistan’s market faced high inflation, PKR depreciation, external financing stress, and political uncertainty, but improved macro stability, IMF support, stronger FX reserves, and easing rates from CY23 fueled a strong recovery, with the KSE-100 Index delivering multi-year gains and emerging as a top-performing frontier market. Despite this, the Equity category showed resilience, with the average return at ~192%. First Capital Mutual Fund received a 3-Star ranking, posting a return of ~158%. As of Dec 2025, the Fund maintained ~89% exposure to equities, ~6.2% in cash, and remaining in other instruments. Major sector allocations included ~19% in Commercial Banks, ~17% in Gas & Exploration Companies, ~10% in Fertilizers, ~7% in Oil & Gas Marketing Companies and ~9% in Cements, with ~27% spread across other sectors. The Fund's strategy focused on balancing growth and liquidity, helping it navigates short-term volatility while capturing long-term upside.