A quiet quarter for MENA equities

MENA equity capital markets recorded their lowest 1Q equity and equity-related issuances since 2021, raising USD 1.2 bn in 1Q 2024, according to data from the London Stock Exchange Group picked up by Zawya. This marks a 6% y-o-y decline, and comes on the back of a 14% y-o-y drop in issuances.

IPOs accounted for 80% of equity capital market activity, with follow-on offerings making up the rest.

IPOs generated USD 931.4 mn in 1Q 2024, representing a decrease of 74% y-o-y. Dubai parking operator Parkin’s IPO was the largest in the region, reeling in USD 428.7 mn in its DFM debut in March, followed by Saudi Arabia’s Modern Mills, which raised USD 314 mn, and the Avalon Pharma, which attracted USD 130 mn. The consumer products and services sector was the most active during the quarter, raising USD 448.1 mn.

Our friends at HSBC as well as Emirates NBD led the underwriting league table, the data shows.

NYSE 24/7?

Are you ready to trade New York equities around the clock? The New York Stock Exchange is polling “market participants” about their appetite for 24 / 7 stock trading. Regulators are separately looking into an application that could make the move possible.

Getting in step with the times? Or the fall of the last bastion of work-life balance in finance? “Stock exchanges have become something of a laggard in a world where other big markets, including US treasuries, major currencies, and leading stock index futures, can be traded around the clock from Monday to Friday,” writes the Financial Times.

And some brokers already simulate 24 / 7 weekday trading in a Rube Goldberg-type system that sees “trades either matched with their internal holdings, or conducted via a ‘dark pool’ trading venue such as Blue Ocean, where shares are often traded with Asian retail investors in their daytime,” the paper notes.

THE MARKETS THIS MORNING- 

Asian shares are mixed in early trading this morning and futures suggest a soft opening for European markets and on Wall Street later today.

THE CLOSING BELL-

The ADX fell 0.6% yesterday on turnover of AED 996.2 mn. The index is down 5.2% YTD.

In the green: Sharjah Cement and Industrial Development (+14.0%), Eshraq Investments (+9.5%) and Phoenix Group (+3.8%).

In the red: Invictus Investment Company (-6.3%), Alpha Dhabi Holding (-5.3%) and Ghitha Holding (-3.9%).

Over on the DFM, the index closed down 0.2% on turnover of AED 383.9 mn Meanwhile, Nasdaq Dubai fell 1.1%.

CORPORATE ACTIONS-

Drake & Scull International in the UAE is calling on shareholders to subscribe to its AED 600 mn capital increase as of this Thursday, with the subscription period ending on 10 May, according to a DFM disclosure (pdf). The capital increase — which comes as part of its restructuring plans in a bid to relist on the DFM — would bring its total issued capital to around AED 3.4 bn. The company is issuing 2.4 bn new shares, priced at a discount of AED 0.75.

Where will the funds go? The raised funds will cover debts, former employee payouts, government fees, and support operational activities and potential acquisitions.

Background: The DFM approved its restructuring plan — which will write off 90% of its debt — back in November 2023, which it was required to implement within a year from approval. The construction company was suspended from trading in November 2018 on the back of excessive financial losses and reporting violations.

ADVISORS- Emirates NBD Capital is serving as lead manager and bookrunner, while Emirates NBD Bank is serving as lead receiving bank.

Emaar Properties approved a dividend payout of AED 4.42 bn for 2023, according to a regulatory filing (pdf).

Emirates Ins. Company approved the distribution of AED 85.5 mn in dividends for 2023, equivalent to 55 fils per share, according to an ADX disclosure (pdf).