Is Southern Copper (SCCO) stock Halal?

Southern Copper is a leading integrated copper producer with exploration, mining, smelting, and refining operations. Boasting a significant presence in Peru and Mexico, the company is engaged in the extraction and production of copper, along with by-products such as molybdenum, silver, and zinc. Southern Copper's primary function is to supply raw materials critical for numerous sectors, especially construction, electronics, and renewable energy industries, where copper's conductivity and ductility are essential. For Muslim investors, though, the most pressing question is simpler: is Southern Copper a Halal investment?

Is Southern Copper Shariah compliant?

Yes. In the October 2026 screening Southern Copper (SCCO) passes AAOIFI Shariah Standard No. 21: the business activity screen and every financial ratio screen hold. Extracting and selling oil, gas or materials is a permissible business, so companies like Southern Copper rarely stumble on the activity screen. The pressure point is capital structure: energy is a capital hungry industry that borrows heavily, and AAOIFI Shariah Standard No. 21 caps interest bearing debt at 30% of market capitalisation, a line that moves as commodity cycles move the share price.

Does Southern Copper pass the business activity test?

Yes. In the October 2026 screening Southern Copper holds an overall PASS, which a stock only earns when its core business clears the activity screen. The activity itself, extracting and selling resources, raises no Shariah objection; the scrutiny belongs to the financing.

Is Southern Copper's income Halal?

Yes, within AAOIFI's tolerance. Southern Copper's income from non-permissible sources stays below 5% of revenue in the October 2026 screening, and the small impure portion is handled through purification: the factor of 98.69% tells holders of SCCO what share of each dividend to keep and what remainder to donate to charity. On a dividend yield of around 1.93%, the purification amount is modest but real.

Does Southern Copper meet AAOIFI's debt and investment ratio requirements?

Yes. Both caps hold this month: interest bearing investments and interest bearing debt each stay below 30% of market capitalisation, measured against a market capitalisation of $171B (market data as of 1 October 2026). Because the caps move with the share price, our Shariah Supervisory Board has SCCO re-screened every month, and the result above always shows the latest verdict.

Why do other halal screeners show a different verdict for Southern Copper?

Screeners can disagree without either being wrong. AAOIFI Shariah Standard No. 21, which Tabadulat applies, measures interest bearing debt and investments against market capitalisation with a 30% ceiling. MSCI and FTSE measure them against total assets with a 33% ceiling, and S&P and Dow Jones Islamic use a multi year average of market capitalisation. Data dates differ too, because each provider reads filings and prices on its own schedule. The same company can therefore pass one standard and fail another in the same month. Tabadulat publishes one answer, the AAOIFI result as of October 2026, and re-screens it every month.

Tabadulat is an ADGM regulated brokerage whose license covers Shari'a Compliant Regulated Activities, as the FSRA permission names them. New to the terminology? Gharar and Maysir, Sukuk, Zakat and purification are all explained in plain English.

New to the screening method? Read AAOIFI Standards Explained: What Makes a Stock Halal?