By: Mahmoud Gamal
Dubai – Mubasher: The UAE’s Securities and Commodities Authority, in collaboration with the Dubai Financial Market’s (DFM) and the Abu Dhabi Securities Market’s (ADX) administrations, is seeking to pave the way for attracting fresh initial public offerings (IPOs).
Some firms announced their interest in launching IPOs, but experts recommended companies not to go public at the beginning of the year until the vision becomes clear amid the volatile trend seen by local and global stocks.
Indian listings
During the Abu Dhabi week in India, kicked off last week, CEO of the ADX Rashed Al Baloushi stressed that the Emirati stock market is seeking to coordinate with some entities in India, including private or public joint stock companies aiming for dual-listing, in an effort to lure new investments.
Family companies
Essa Kazim, CEO of the DFM, had previously said that the stock market is at pains to spur family and private companies to turn into public shareholders and to be listed on the bourse, which will be a key step in the development of these firms.
MAG Group
On Monday, 12 February, CEO of the Moafaq Al Gaddah Group (MAG Group) Talal Al Gaddah revealed that the company is mulling over floating shares on the DFM within or after three years from now.
Luring investments
The UAE bourses are currently waiting for liquidity to boost investment portfolios through new IPOs, managers of brokerages told Mubasher.
Good pricing of the IPOs’ stocks is the major factor for investors, they added.
Feeding local bourses
IPOs are currently needed to feed the UAE stock markets with fresh investment opportunities, CEO of Al Safwa Mubasher Ehab Rashad said.
Firms with good financials can lure liquidity as long as they set suitable stock prices for investors, Rashad indicated.
He further noted that family businesses were deemed a good chance for UAE bourses to maintain sustainability.
Investors are likely to pump additional investments into stock markets if they achieve earnings from IPOs, he added.
Diversifying investors
Launching any new IPO will diversify the investor base of the Emirati bourses, managing director asset management at Menacorp Tariq Qaqish said.
Setting suitable prices is a key factor to ensure IPOs success, he added.
The UAE stock markets do not suffer from thin liquidity, but good opportunity and adequate pricing will lure traders to IPOs, Qaqish noted.
The required level
On his part, Jamal Ajaj, Al-Sharhan Centre's general manager said that this was not the opportune time for launching an IPO, especially after last year’s IPOs were not well received.
These IPOs could not record any growth in terms of prices, Ajaj highlighted, adding that liquidity was currently weak and fluctuating.
Translated by: Mai Ezz El-Din
