Qatar's primary market will become turn again after Ramadan and the listing of four Qatar Petroleum subsidiaries ought to augur well for the market, according to experts.
"In all possibilities, the initial public offerings (IPOs) are to become active post-Ramadan," an analyst with a leading brokerage house said.
Qatar's equity market has already witnessed announcements from Doha Global Investment and Barwa Bank regarding their maiden offers.
The investment firm, backed by assets from the sovereign wealth fund, will have total capital of QR45bn, 50% of which will be in the form of paid-up capital, with Qatar Holding transferring assets worth around $3bn into the company.
Barwa Bank is aiming to raise QR1.05bn by offering 50mn shares at QR21 each.
Asked about the delay in the listing of Doha Global Investment, whose maiden offer was to have happened this month; he said although it hogged the limelight in the media "one should not read too much into the delay" as it is procedural in nature rather than anything to do with the market conditions.
He said issuers would have thought post-Ramadan could fetch more investor interests since the time was not ripe especially before Ramadan, particularly in the Arab region.
Another analyst with a brokerage arm of a bank also said the maiden offers of both Doha Global and Barwa Bank were expected after the fasting month.
"The market is on the upswing and to that extent it gives leverage to absorb such offerings," he said, adding that profit booking could be visible especially during the time by which these offerings come to the market.
Going by the performance of other GCC bourses, especially Dubai, Abu Dhabi, Kuwait and Muscat; the analysts held that the Qatari exchange offers much potential as macroeconomic conditions are supportive.
Private sectors could cash in on from the huge capital expenditure laid out for infrastructure and the country's efforts to diversify away from its bread and butter hydrocarbons income and as enshrined in the Qatar National Vision 2030 and National Development Strategy, they said.
"It is where the private sector comes into play and it is the time for them to fortify and expand their capital base; thus paving way for further listings and rights issues," one of them said.
Many entities -- including Qatar First Bank, QInvest and Mowasalat -- have made their intentions clear about listing on the bourse.
Prime Minister HE Sheikh Hamad bin Jassim bin Jabor al-Thani had recently urged private and family firms to consider listing in the bourse to have a "significant positive" impact on the economy and help government attract foreign investments.
Qatar's private sector contribution to national exchequer has not reached the desired level and the present level of listed companies in the country's bourse has not reflected the size and position of the economy, according to him.
The key index of the Qatari bourse is up about 9% year-to-date, mainly due to strong upward rally in the industrials, telecom, consumer goods and insurance segments, which have witnessed double-digit appreciation.
On the proposed listings of QP subsidiaries, analysts are of the view that it would give a huge fillip and the much-needed confidence to the market.
Although finer details regarding the subsidiaries and their individual listing sizes have not yet been made public; indications are that those entities may not be in the high value addition chain in the hydrocarbon sector, which accounts for 60% of Qatar's economy.
"Still, those can make a difference considering that the listing comes from the country's bellwether entity," one of the analysts said, declining to hazard a guess on those QP subsidiaries that are set to make their debut in the Qatar Exchange, whose classification from global index compiler MSCI is up for review next month.
© Gulf Times 2013
