Abdelaziz Nasser Al Emadi, Listing Director at QSE
There is a growing trend among small and medium-sized enterprises in Qatar to prefer direct listing when selling their shares to the public, an official from the Qatar Stock Exchange (QSE) has said.
Talking to The Peninsula on the sidelines of the successful debut of Mekdam Holding Group on the QSE Venture Market (QEVM) recently, Abdelaziz Nasser Al Emadi, Listing Director at QSE, said there are already a number of SMEs currently finalising their applications to get listed on the QSE Venture Market and most of them are eyeing direct listing.
“We’re receiving very positive response from the SME industry in Qatar. We receive a lot of calls and requests for meetings after Al Faleh Educational Holding, the first company to get listed. We’re getting a very good reaction from the business community, and we see that many of the companies prefer direct listing without offering, which is the easier and faster route as well. And even recently, we saw in the US stock market that they approved direct listing as well. So it seems this kind of requirement is preferred by companies internationally,” said Al Emadi.
In contrast to the initial public offering (IPO), direct listing, also called direct public offering, allows businesses to sell their shares directly to the public without the help of intermediaries. It does not involve any underwriters and there are no new shares issued.
To date, two companies are already listed on the QSE Venture Market which has been recently launched particurly for SMEs in Qatar. Al Faleh Educational Holding and Mekdam Holding Group both went through the direct listing process.
“There is a good number of companies which are now also trying to finalise their applications to get listed on the QEVM. But it’s not certain yet if they will debut this year or next year,” said Al Emadi when asked on how many more SMEs are in the pipeline to debut on the QEVM.
He added that both large companies and the SMEs will benefit from the advantages of being listed on the overall QSE market. This includes diversifying their sources of funding, which will also help businesses in recovering from the economic impact of the COVID-19 pandemic.
“To list on the venture market, or any market is really a big opportunity and companies, whether SMEs or big companies, will get a lot of incentives. And specifically for SMEs, the venture market is much easier for finance, cheaper, and zero risk. This could even help them expand their businesses even further,” he added.
Al Emadi went on to highlight that the QSE currently sees an almost equal number of retail and institutional investors in the Qatari stock market.
“For Qatar Stock Exchange, we’re not looking at having either more retail or institutional investors. But today in Qatar, from the daily trading, the report shows, it’s usually 50-50. It’s mostly equal between the retail and institutional investors,” he said.
And while venture markets in other countries also include startups, Al Emadi said the QSE Venture Market is currently not yet looking into that. “Not yet. We are not looking into that. For startups, the Qatar Development Bank (in addition to other platforms) is taking care of the startup companies. We as a stock exchange try to fill the gap for the small and medium-sized enterprises and that’s why we created this venture market,” said Al Emadi.
He added that the QSE also plans to develop the Qatari tech stock market to be at par with the international market.
