Abu Dhabi: Muhannad Dagher
The UAE stock markets are witnessing a great rush of investors, whether individuals or institutions, to initial public offerings of companies that have intensified during the current year, as a quantum leap has been observed in their number, and many of them have returned to increase their offered share.
Stock experts believe that all these offerings were successful in large proportions in terms of underwriting coverage, listing and share performance in the market, especially since the markets succeeded in selecting distinguished companies in terms of strong financial performance and operational activity.
Experts confirmed through the “Gulf” platform that these experiences and the profits achieved will prompt investors to participate strongly in the upcoming IPOs, which are no less important than the previous ones, and it is a golden investment opportunity for all investors.
They said: «It is very noticeable among the underwriting banks and brokerage firms, that the subscribers have a great appetite for new offerings from the existing and new investors, while the investors benefited from the high prices, the high volume of liquidity and the diversity of the listed companies to open up many and many options for the investor».
They stressed that investors are always looking for stability for their investments in the long term, which is an advantage that the UAE enjoys, given the strong performance of its companies, with expectations that the UAE markets will remain in an upward trend during the last quarter of this year, given the rise in oil prices and strong economic growth. In addition to the start of the tourism season.
Distinguished proposals
Iyad Al-Buraiqi, Head of Business Development Department at Al-Dar for Shares and Bonds, confirmed that the offerings of new companies are still at their peak in the UAE markets, and all these offerings were successful in large proportions in terms of coverage of the subscription and in terms of listing and share performance in the market.
Al-Buraiqi pointed out that the markets succeeded in selecting distinguished companies that have strong financial performance and effective operational activity, which led to an influx of demand for them by institutions and individuals.
Al-Bariqi considered these listings a successful and effective investment for all segments because of the very good capital profits they achieved, and perhaps doubled within a short period of days. Significant among the underwriting banks and brokerage firms. Subscribers flocked with a great appetite for new proposals from existing and new investors.
He said: These experiences and the profits achieved will prompt investors to participate strongly in the upcoming IPOs, as we are promised to offer strong and huge companies during the last quarter of this year, such as.
Al-Buraiqi stated that such subscriptions represent a golden investment opportunity for all investors regardless of the allocation percentage, even if it is sometimes low for individuals in particular. The bulk of the demand for underwriting.
He added that there is no doubt that the state of health and the distinguished performance that the country’s markets are going through has a great impact and a significant contribution to the success of listing new companies, which increase the market value and depth of the market, while investors benefited from the high prices, the high volume of liquidity and the diversity of listed companies. To open many and many options for the investor.
Al-Buraiqi expected that the activity would increase in the last quarter of this year in light of the liquidity of the companies that will join the markets and with the start of the tourism season and the World Cup, which heralds distinguished and strong performance and real investment opportunities, and also in light of the good performance of the current companies in the markets.
Quantum leap
Vijay Valesha, Head of Investment Department at Century Financial, said: “The great trend and growing demand for investment in the UAE stock market is due to many new laws and regulations that encouraged investors to invest, while raising the ceiling for foreign ownership of companies, and adding company shares to indices. global companies such as MSCI and FTSE Russel, which led to an improvement in liquidity levels, in light of the listing of strong companies.
Valesha added that investors are always looking for stability in their investments in the long term, which is an advantage that the UAE enjoys, given the strong performance of its companies, at a time when new IPOs in the UAE made a quantum leap, with the arrival of the most prominent of these companies to the IPO market this year. Most of them are governmental, or quasi-governmental, and they are considered a safe haven for investment amid the energy turmoil elsewhere in the world.
Valesha considered that these subscriptions reflect a smart strategy because they also raise the status of the financial markets and are in good agreement with the plans of the Abu Dhabi and Dubai financial markets to achieve a market capital exceeding 6 trillion dirhams in both markets.
safe haven
Valesha stressed that high oil prices have enhanced the opportunities for economic growth in the UAE, given that the UAE market is a safe haven for investment amid global turmoil in financial assets, and with the possibility of a hypothesis that oil will receive a decent geopolitical premium in the near term, prices are likely to remain. High.
He pointed out that the new listed companies opened the door to investment and encouraged the influx of international investors, given that UAE stock prices are still attractive, noting that since the beginning of the year, the FTSE Abu Dhabi Market index is the seventh best performance index, with a rate of 22.53%.
Valesha noted that the International Monetary Fund indicated that the UAE’s economic growth in the current year amounted to 5.1%, 4.2% in 2023 and 3.6% in 2024, stressing that these numbers are high when compared to global economies, which are likely to be It has a positive impact on the UAE listed companies.
Valesha believes that the UAE banking sector has adopted new resilience mechanisms to face the effects of the global pandemic, including digitization, corporate governance and risk management strategies that have strengthened its shares, as the high level of digitization has reduced its costs and increased its profits.
Momentum continues
Financial expert Tariq Qaqish expected the continuation of the activity of public offerings as a result of several factors, including: economic growth supported by high oil prices and the presence of high liquidity as well, in addition to government plans to support financial markets in terms of legislation and new listings, with many government-owned companies offering for public subscription at a time Private companies followed suit, too.
Qaqish stressed that the quality of the offered companies helped investors achieve profitable returns following the listing process, and this is one of the most important factors that worried investors in the old offerings, but we are now seeing high liquidity, especially in the Abu Dhabi market, and thus the interest increased, and we saw the process of covering subscriptions several times. This indicates that there is confidence in the markets.
He pointed out that in previous periods, we witnessed a lack of confidence in the market, as a result of the presence of companies that suffered financial crises, but the new laws that took place are considered an attractive point for investors, and they stimulated investment in the markets.
And Qaqish indicated that the previous problems of some listed companies have become a thing of the past, with the current boom in the markets in terms of liquidity, the market value of companies and the quality of these companies.
Liquidity jump
Aaron Leslie John, chief market analyst at Century Financial, expected that the UAE markets would remain thriving in the last quarter of this year, given the rise in oil prices and strong economic growth, in addition to the start of the tourism season, and Qatar’s hosting of the 2022 World Cup.
Leslie John stressed that the strong demand for initial public offerings in the UAE is evidence of the interest of investment companies in the country, in light of the difficult international circumstances this year.
Leslie John revealed that the average daily traded value of shares in the general “FTSE Abu Dhabi Market” index increased from $313 million (1.15 billion dirhams) in 2021 to $417 million (1.53 billion dirhams) in 2022. The average daily trading volume for the year 2022 It is 906.49 million dirhams, compared to 743.76 million last year.
On the other hand, the Dubai Stock Exchange index witnessed a jump in the average daily trading value to 314.8 million dirhams last year, and this increase in the average volume is an indication of the inclusion of more large companies in the index.
tourism
Aron expected a great recovery in the UAE, especially with the start of the tourism season and the positive impact that will result from Qatar hosting the 2022 World Cup, at a time when UAE tourism revenues exceeded $5 billion during the first half of this year.
He added: «Hotels in Dubai are already witnessing an increase in demand, and a survey conducted previously showed that most travelers chose the UAE as their tourist destination for this year.
