Shariah Methodology - Al Meezan Investment Management Limited
Al Meezan Investments

Shariah Methodology

At Al Meezan, we are dedicated to providing Shariah compliant investment solutions. In this regard we adhere to the Shariah guidelines as advised by the Shariah Board. The investments are limited to asset classes approved by the Shariah Advisor and all companies under investment consideration are regularly screened for Shariah compliance.

Shariah Screening Criteria (for equity securities)

Shariah compliance of stocks is done under the guidance of qualified and reputed Shariah experts. For stocks to be “Shariah compliant”, it must meet ALL the six key tests given below.

Business of the Investee Company

Core business of the company must be halal and in line with the dictates of Shariah. Hence, investment in securities of any company dealing in conventional banking, conventional insurance, alcoholic drinks, tobacco, pork production, arms manufacturing, pornography or related activities is not permissible.

Debt to Total Assets

Debt to Asset ratio should be less than 37%. Debt, in this case, is classified as any interest bearing debts. Zero coupon bonds and preference shares are, both, by definition, part of debt.

Non-Compliant Investments to Total Assets

The ratio of non compliant investments to total assets should be less than 33%. Investment in any non-compliant security shall be included for the calculation of this ratio.

Non-Compliant Income to Total revenue – Purification of Non-compliant income

The ratio of non compliant income to total revenue should be less than 5%. Total revenue includes Gross revenue plus any other income earned by the company. This amount is cleansed out as charity as a pro rata ratio of dividends issued by the company.

Illiquid Assets to Total Assets

The ratio of illiquid assets to total assets should be at least 25%. Illiquid asset, here, is defined as any asset that that Shariah permits to be traded at value other than the par.

Net Liquid Assets to Share Price

The market price per share should be greater than the net liquid assets per share calculated as: (Total Assets – Illiquid Assets – Total Liabilities) divided by number of shares.


Sr. # Ticker Company Status Charity Rate
1 AABS Al-Abbas Sugar Mills Ltd Compliant1 0.66%
2 ABOT Abbott Lab (Pakistan) Ltd Compliant 0.84%
3 ACPL Attock Cement Pakistan Ltd Compliant 0.05%*
4 AGIL Agriauto Industries Ltd Compliant 0.50%*
5 AGP AGP Limited  Compliant 0.09%
6 AGSML Abdullah Shah Ghazi Sugar Mills  Compliant1 0.00%
7 AKZO Akzo Nobel Pakistan Compliant 1.50%
8 APL Attock Petroleum Ltd Compliant 0.81%*
9 ARPL Archroma Pakistan Ltd Compliant1 0.00%
10 ASC Al Shaheer Corporation Ltd Compliant 0.00%*
11 ASTM Asim Textile Mills Ltd Compliant 1.05%*
12 ATBA Atlas Battery Ltd Compliant 0.00%*
13 PREMA At-Tahur Limited Compliant 0.00%*
14 ATRL Attock Refinery Ltd Compliant 1.29%*
15 BATA Bata (Pakistan) Ltd Compliant 0.08%
16 BCL Bolan Castings Ltd Compliant 0.02%*
17 BGL Balochistan Glass Ltd Compliant 0.09%*
18 BIFO Biafo Industries Ltd Compliant 1.08%*
19 BIPL BankIslami Pakistan Ltd. Compliant 0.00%
20 BWCL Bestway Cement Ltd Compliant 2.37%*
21 BYCO Byco Petroleum Pakistan Ltd Compliant 0.42%*
22 CHCC Cherat Cement Co. Ltd Compliant 0.01%*
23 CLOV Clover Pakistan Ltd Compliant 4.44%*
24 CSAP Crescent Steel & Allied Products Compliant 0.01%*
25 DCL Dewan Cement Ltd Compliant 0.19%*
26 DCR Dolmen City REIT Compliant 0.00%*
27 DFSM Dewan Farooq Spinning Mills Ltd Compliant 0.00%*
28 DGKC D.G. Khan Cement Co. Ltd Compliant 3.11%*
29 DSIL DS Industries Ltd Compliant 0.01%*
30 EFERT Engro Fertilizers Ltd Compliant 1.34%
31 FCEPL Frieslandcampins Engro Foods Limited (Engro Foods Ltd.) Compliant 0.02%
32 ENGRO Engro Corporation Ltd Compliant 4.72%
33 EPCL Engro Polymer & Chemicals Compliant 1.88%
34 EXIDE Exide Pakistan Ltd Compliant1 0.01%*
35 FATIMA Fatima Fertilizer Co. Ltd Compliant 1.15%
36 FCCL Fauji Cement Co. Ltd Compliant 0.17%*
37 FECM First Elite Capital Modaraba ^ Compliant 0.08%*
38 FECTC Fecto Cement Ltd Compliant 0.64%*
39 FEROZ Ferozsons Laboratories Ltd Compliant 0.05%*
40 FLYNG Flying Cement Co. Ltd Compliant 0.00%*
41 FML Feroze1888 Mills Ltd Compliant 0.24%*
42 GAIL Ghani Automobile Industries Ltd Compliant 0.14%*
43 GGGL Ghani Global Glass Ltd Compliant 0.05%*
44 GGL Ghani Global Holdings Limited  Compliant 0.05%*
45 GHGL Ghani Glass Ltd Compliant 0.00%*
46 GHNI Ghandhara Industries Ltd Compliant 0.01%*
47 GHNL Ghandhara Nissan Ltd Compliant 0.76%*
48 GLAXO GlaxoSmithKline Pakistan Compliant 0.41%
49 GSKCH Glaxo SmithKline Consumer Healthcare Compliant 0.16%
50 GVGL Ghani Value Glass Ltd Compliant 0.11%*
51 GWLC Gharibwal Cement Ltd Compliant 0.73%*
52 HABSM Habib Sugar Mills Ltd Compliant1 2.06%
53 HASCOL Hascol Petroleum Ltd Compliant3 0.15%*
54 HCAR Honda Atlas Cars (Pakistan) Ltd Compliant1 0.54%*
55 HINOON Highnoon Laboratories Ltd Compliant 0.56%
56 HSM Husein Sugar Mills Ltd Compliant1 0.00%
57 HTL Hi-Tech Lubricants Ltd Compliant 2.48%*
58 IBLHL IBL HealthCare Ltd Compliant 1.02%*
59 ICI ICI Pakistan Ltd Compliant 0.06%*
60 ICL Ittehad Chemicals Ltd Compliant 0.00%*
61 ILP Interloop Limited Compliant 0.31%
62 INDU Indus Motor Company Ltd Compliant 2.10%*
63 ISL International Steels Ltd Compliant 0.01%*
64 ITTEFAQ Ittefaq Iron Industries Compliant 0.19%*
65 KEL K-Electric Ltd  Compliant3 0.78%
66 KOHC Kohat Cement Co. Ltd Compliant 0.07%*
67 KTML Kohinoor Textile Mills Ltd Compliant 0.55%*
68 LOTCHEM Lotte Chemical Pakistan Ltd Compliant 1.73%
69 LUCK Lucky Cement Ltd Compliant 2.59%*
70 LPL Lalpir Power Ltd***    
71 MARI Mari Petroleum Co. Ltd Compliant 3.13%*
72 MEBL Meezan Bank Ltd Compliant 0.00%
73 MLCF Maple Leaf Cement Factory Compliant 0.19%*
74 MTL Millat Tractors Ltd Compliant 0.11%*
75 NATF National Foods Ltd Compliant 0.00%*
76 NETSOL NetSol Technologies Ltd Compliant 0.34%*
77 NML Nishat Mills Ltd Compliant 1.59%*
78 NCPL Nishat Chunian Power Ltd***    
79 NRL National Refinery Ltd Compliant 0.09%*
80 OGDC Oil & Gas Development Co. Ltd*** Compliant 7.73%
81 PAEL Pak Elektron Ltd Compliant 0.04%
82 PAKOXY Pakistan Oxygen Limited Compliant 0.01%
83 PICT Pakistan International Container Terminal Compliant 0.91%
84 PKGS Packages Limited Compliant 0.97%
85 PNSC Pakistan National Shipping Corporation Compliant 1.67%*
86 POWER Power Cement Ltd Compliant 0.43%*
87 POL Pakistan Oilfields Ltd***** Compliant 4.09%
88 PPL Pakistan Petroleum Limited Compliant 1.59%*
89 PSO Pakistan State Oil Co. Ltd Compliant 0.90%*
90 PTC Pakistan Telecommunication (PTCL) Compliant 1.46%
91 QUICE Quice Food Industries Ltd Compliant3 1.10%*
92 REDCO Redco Textiles Ltd Compliant 0.04%*
93 RPL Roshan Packages Ltd Compliant 2.27%*
94 SAZEW Sazgar Engineering Works Compliant 0.00%*
95 SEARL The Searle Company Ltd Compliant 0.21%*
96 SPWL Saif Power Ltd***    
97 SEPL Security Papers Ltd Compliant 4.53%*
98 SHEL Shell (Pakistan) Ltd Compliant 0.01%
99 SHSML Shahmurad Sugar Mills Ltd* Compliant1 0.02%
100 SKRS Sakrand Sugar Mills Ltd Compliant1 0.01%
101 SNGP Sui Northern Gas Pipelines Ltd Compliant3 1.25%*
102 SPEL Synthetic Products Ltd Compliant 0.00%*
103 SPL Sitara Peroxide Ltd Compliant 0.02%*
104 SSGC Sui Southern Gas Co. Ltd Compliant3 2.30%
105 STCL Shabbir Tiles & Ceramics Ltd Compliant 0.07%*
106 STPL Siddiqsons Tin Plate Ltd Compliant 4.27%*
107 SYS Systems Limited Compliant 3.53%
108 THCCL Thatta Cement Company Compliant 0.82%*
109 TREET Treet Corporation Ltd Compliant 0.11%*
110 TRPOL Tri-Star Polyester Ltd Compliant 0.00%*
111 UNITY Unity Foods Ltd Compliant 0.02%*
112 WAVES WAVES Singer Pakistan Ltd Compliant 1.59%
113 WTL WorldCall Telecom Ltd Compliant3 0.25%*
114 ADAMS Adam Sugar Mills Ltd Compliant1 0.04%
115 BRR B.R.R. Guardian Modaraba ^ Compliant 0.40%*
116 BUXL Buxly Paints Ltd Compliant 0.07%*
117 COLG Colgate Palmolive (Pakistan) Compliant 1.52%*
118 FHAM First Habib Modaraba Compliant 0.00%*
119 FPJM First Punjab Modaraba ^ Compliant 0.28%*
120 FUDLM First UDL Modaraba  Compliant 0.00%*
121 JSML Jauharabad Sugar Mills Ltd. Compliant1 0.02%
122 JVDC Javedan Corporation Ltd Compliant 0.18%*
123 LEUL Leather-Up Limited Compliant 0.38%*
124 ORIXM Orix Modaraba Compliant 0.00%*
125 PCAL Pakistan Cables Ltd Compliant 0.01%*
126 SITC Sitara Chemical Industries Ltd Compliant 0.00%*
127 AGL Agritech Limited Non-Compliant3  
128 AGTL Al-Ghazi Tractors Ltd Non-Compliant  
129 AHCL Arif Habib Corporation Ltd Non-Compliant  
130 ANL Azgard Nine Ltd Non-Compliant  
131 ASL Aisha Steel Ltd Non-Compliant  
132 ASTL Amreli Steels Ltd Non-Compliant  
133 AVN Avanceon Limited Non-Compliant  
134 CEPB Century Paper & Board Mills Non-Compliant  
135 CPPL Cherat Packaging Ltd Non-Compliant  
136 CRTM Crescent Textile Mills Ltd Non-Compliant  
137 CTM Colony Textile Mills Ltd Non-Compliant  
138 CWSM Chakwal Spinning Mills Ltd Non-Compliant  
139 DAWH Dawood Hercules Corporation Non-Compliant  
140 DOL Descon Oxychem Ltd Non-Compliant  
141 ECOP EcoPack Ltd Non-Compliant  
142 EPQL Engropowergen Qadirpur***    
143 FFBL Fauji Fertilizer Bin Qasim Ltd Non-Compliant  
144 FFC Fauji Fertilizer Company Ltd Non-Compliant  
145 FFL Fauji Foods Ltd Non-Compliant  
146 GATM Gul Ahmed Textile Mills Ltd Non-Compliant  
147 GTYR General Tyre & Rubber Co. Non-Compliant  
148 HINO Hinopak Motors Ltd Non-Compliant1  
149 HUBC Hub Power Company Ltd** Non-Compliant  
150 INIL International Industries Ltd Non-Compliant  
151 KAPCO Kot Addu Power Company Non-Compliant  
152 KOIL Kohinoor Industries Ltd Non-Compliant  
153 KOSM Kohinoor Spinning Mills Ltd Non-Compliant  
154 LOADS Loads Limited Non-Compliant  
155 MERIT Merit Packaging Ltd Non-Compliant  
156 MFL Matco Foods Ltd Non-Compliant  
157 MUGHAL Mughal Iron & Steel Industries Non-Compliant  
158 NCL Nishat (Chunian) Ltd Non-Compliant  
159 NPL Nishat Power Limited***    
160 NRSL Nimir Resins Ltd Non-Compliant  
161 PACE Pace (Pakistan) Ltd Non-Compliant  
162 PIBTL Pakistan International Bulk Terminal Ltd Non-Compliant  
163 PIOC Pioneer Cement Ltd Non-Compliant  
164 PKGP Pakgen Power Ltd Non-Compliant  
165 PMI First Prudential Modaraba**** Non-Compliant  
166 PRL Pakistan Refinery Ltd Non-Compliant  
167 PSMC Pak Suzuki Motor Co. Ltd Non-Compliant  
168 PSX Pakistan Stock Exchange Ltd. Non-Compliant  
169 SERF Service Fabrics Ltd Non-Compliant  
170 SRVI Service Industries Ltd Non-Compliant3  
171 TELE Telecard Limited Non-Compliant  
172 TGL Tariq Glass Industries Ltd Non-Compliant  
173 THALL Thal Limited Non-Compliant  
174 TPL TPL Corporation Non-Compliant  
175 TRG TRG Pakistan Ltd Non-Compliant  
176 TRIPF Tri-Pack Films Ltd Non-Compliant  
177 TSPL Tri-Star Power Ltd. Non-Compliant  
178 UBDL United Brands Limited Non-Compliant  
179 WYETH Wyeth Pakistan Ltd Non-Compliant2  
180 YOUW Yousaf Weaving Mills Ltd Non-Compliant  
181 GADT Gadoon Textile Mills Ltd Non-Compliant  
182 NESTLE Nestle Pakistan Ltd Non-Compliant  
183 TPLP TPL Properties Ltd  Non-Compliant  
184 PIAA Pakistan International Airlines Corporation Limited (PIACL) Non-Compliant  
185 MDTL Media Times Ltd NC by nature  
186 HUMNL Hum Network Ltd NC by nature  
187 AHL Arif Habib Ltd NC by nature  
188 BOK Bank of Khyber NC by nature  
189 ESBL Escorts Investment Bank Ltd NC by nature  
190 FABL Faysal Bank Ltd. NC by nature  
191 FCSC First Capital Securities Corp. Ltd NC by nature  
192 FDIBL First Dawood Investment Bank Ltd NC by nature  
193 ICIBL Invest Capital Investment Bank NC by nature  
194 JSCL Jahangir Siddiqui & Co. Ltd NC by nature  
195 PASL Pervez Ahmed Securities Ltd NC by nature  
196 CYAN Cyan Limited NC by nature  
197 BIPLS BIPL Securities Limited NC by nature  
198 FNEL First National Equities Ltd NC by nature  
199 JSIL JS Investments Ltd NC by nature  

Charity rate means the investors of respective companies should purify dividend income using the following formula:

Dividend income received x Charity rate

NC = Non-Compliant

* * These are provisional rates for dividend purification which are subject to final adjustment upon announcement of respective companies’ annual accounts for the year 2019/2020.

** Non Compliant Revenue earned by CPPA (GoP) and non compliant expensed paid to PSO (GoP) has been set off.

*** Status is not ascertained due to non-disclosure of the required information as per last available financial statement i.e breakup of sales revenue including interest element.

**** Non-Compliant due to lower share price as at December 31, 2019 compared to Net Liquid Asset per share.

***** POL has reversed its revenue of 13.5 billion as conservative approach due to pending court judgement as mentioned in financial statements. It justifies that actual revenue of the POL exceeds by this amount. Considering above information ratio on non compliant income to total income is less then 5%.

*****OGDC is facing circular debt issues. Company is bound to retain interest bearing TFC/Bonds having no permission to sell from government. Due to high interest rate during July-Dec 2019, non compliant income is high and exceeds 5%. Company had provided written confirmation that its non compliant income ratio will be less than 5% due to lower interest rates during July-Dec 2020.

^ Charity rate arises due to the income prorated from the Non Compliant Income of June-2019 / Income arising from investments in Non – Compliant scrips as at December 2019.

  1. Based on September-2019 accounts
  2. Based on November-2019 accounts
  3. As per last available annual / half-yearly accounts