Sindh Modaraba (SM) is set for a major capital boost as the Sindh Cabinet has approved Rs2 billion equity injection over the next two fiscal years.
The listed company disclosed the development in its notice to the Pakistan Stock Exchange (PSX) on Tuesday.
“The Sindh Cabinet has approved Rs2 billion in equity injections for Sindh Modaraba (Rs1 billion during FY-2025-26 and another Rs1 billion during FY-2026-27) over the next two years, to strengthen the Islamic financing portfolio, projecting steady growth in profits, portfolio size, and organisational scale through new branches, more staff, and enhanced reserves,” read the notice.
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Sindh Modaraba has been floated under the Modaraba Companies and Modaraba (Floatation and Control) Ordinance, 1980 and is managed by Sindh Modaraba Management Limited.
SM is a perpetual, multi-purpose and multi-dimensional modaraba and is primarily engaged in providing Shariah-compliant financing facilities to creditworthy customers.
A modaraba is a type of Islamic partnership where one party, the Rab-ul-Mal (investor), provides capital, and the other party, the Mudarib (manager), contributes their skills and effort to run the business. Profits are shared based on an agreed-upon ratio, but all losses are borne by the Rab-ul-Mal. This is a non-interest-based system that operates on the principles of profit and loss sharing.
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