UAE stock markets target London in foreign investment push

ADX

• ADX roadshow held 204 investor meetings in UK capital
• DFM delegates included DEWA, Emaar and Dubai Islamic Bank execs

Stock markets in Dubai and Abu Dhabi are targeting London as they aim to strengthen their status as key destinations for international investors.

Both the Abu Dhabi Securities Exchange (ADX) and the Dubai Financial Market (DFM) have completed investor roadshows in the British capital, holding hundreds of meetings with some of the world’s largest asset management firms.

Collectively across the two roadshows, talks took place with firms who hold over $6 trillion in assets under management (AuM).

ADX, which hosted a delegation of over 25 senior executives from nine listed companies and the exchange, held 204 investor meetings across 47 one-on-one meetings and 37 group meetings, with a total of 89 institutional investors.

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The DFM roadshow, with the participation of nine equity and debt issuers on Dubai capital markets, included 162 meetings with senior representatives of 56 international funds. The delegation included Dubai Electricity and Water Authority (DEWA), which completed a $6.1 billion initial public offering (IPO) in April, the region’s biggest since Saudi Aramco.

The ADX roadshow comes amid a backdrop of significant and sustained activity on the exchange which has seen growing demand and interest across its capital markets from international and institutional investors – including on IPOs, listings and new product launches. 

This stream of activity has led to ADX recently surpassing the AED2 trillion market capitalisation target milestone to become the second-largest exchange in the Middle East.

“The well-attended roadshow and size of the ADX delegation is a clear example of the deep and growing international and institutional investor confidence in both Abu Dhabi as a premier investment destination and ADX as the hub for regional participation of institutional and international capital,” Saeed Hamad Al Dhaheri, managing director and CEO of ADX, said.

“This is evident through the robust demand our recent IPO pipeline and listings have continued to attract.”

Hamed Ali, CEO of DFM and Nasdaq Dubai, added: “International investors are actively participating in our market maintaining nearly 52 percent of trading activity and 23 percent of ownership. 

“On the other hand, our listed companies are increasingly opening up to foreign investors. For instance, Aramex recently allowed 100 percent foreign ownership.

“These positive indicators and initiatives strengthen the Dubai capital markets position at the forefront of the most welcoming and receiving of foreign investments in the region.”

ADX’s recent initiatives to foster and attract international investors continue to bear fruit, with institutional investors trading values increasing by 83 percent from AED93 billion in Q1 2021 to reach AED170 billion in Q1 2022, while net foreign investment stood at AED8.3 billion. 

The market value of shares owned by foreign investors has also jumped from AED50 billion in Q1 2021 to AED131 billion during Q1 2022, an increase of around 163 percent with the top 25 asset and fund managers in the world in terms of AuM currently invested in ADX-listed companies.

The lure of high dividends has been a major draw for global investors amid a recent wave of mega listings across the Gulf region, led by Saudi Arabia and the UAE.

Dubai has sought to tap into the investor demand by embarking on a major IPO push, with state utility DEWA launching its offering in April, with as many as a dozen state companies going public in the coming months.

HSBC helped organise the DFM roadshow in London and Abdulfattah Sharaf, CEO of HSBC UAE and head of International Middle East, said: “The UAE economy is a hub of market activity across the Middle East, as evidenced by the past year’s boom in IPO listings across the country. 

“Despite ongoing global challenges, the UAE economy has been resilient and that is reflected in surging demand from investors, seeking access to this rapidly-emerging market.

“We are excited to connect our global investors to the opportunities in the UAE and that is why we’ve convened this event.”

The senior ADX delegation included over 25 senior executives from ADNOC Distribution, ADNOC Drilling, Abu Dhabi Islamic Bank, Agthia, Aldar Properties, Al Yah Satellite Communications Company (Yahsat), Emirates Telecommunication Group Company (Etisalat), First Abu Dhabi Bank and Fertiglobe.

The DFM delegation includes executives from DEWA, Dubai Islamic Bank, Emaar Properties, Emaar Development, Emirates NBD, DP World, Amanat, Aramex and DFM Company.

Bader Saeed Al Lamki, CEO of ADNOC Distribution, said: “This has been a year of unprecedented investor interest in companies based in the UAE, underpinned by the country’s attractive macroeconomic environment and increased capital markets activities.”

Saeed Mohammed Al Tayer, managing director and CEO of DEWA, added: “We were pleased to meet international investors in person to highlight our achievements and showcase the strength and efficiency of our portfolio of assets as the largest company on the DFM.

“We were eager to demonstrate the robustness of our sustainability-focused growth strategy that is intended to deliver a strong recurring value proposition to our investors.”