Abu Dhabi Securities Exchange will embark on an initiative to sell the attractions of its capital market to the biggest investors in the world with a roadshow to Wall Street.
This week, the ADX will lead a group of the UAE’s biggest companies on a visit to New York, where they will tell investing institutions such as Goldman Sachs, JPMorgan and Fidelity about the growth potential for the emirate’s equity markets.
The move, which has been organised by the ADX chief executive Rashed Al Baloushi with assistance from HSBC, has been prompted by the forthcoming inclusion of the nation's markets on the MSCI Emerging Markets Index.
“As a stock exchange we want to attract institutional investors to play a more positive role in the markets in Abu Dhabi,” said Mr Al Baloushi. “We want to show them how we can develop after the MSCI upgrade. The economy of the capital is doing very well, with infrastructure investment of US$100 billion lined up over the coming years.”
Speaking at last week’s Berlin International Economics Congress, Mr Al Baloushi said that MSCI’s decision recognised “the progress we have made to meet the standards required by international investors, but it also of course helps to bring in the international investment that will accelerate our development”.
He also highlighted that investment appetite for the UAE had returned in a strong way at both the public and private levels and was set to strengthen further.
The 10 companies visiting the United States include blue chips of the UAE investment scene such as Etisalat, Abu Dhabi Commercial Bank, Aldar and Dana Gas.
First Gulf Bank, National Bank of Abu Dhabi, RAK Properties, Waha Capital, Invest AD and Agthia will also be present. Mr Al Baloushi said he hoped to top off the visit by ringing the starting bell on the floor of the New York Stock Exchange.
HSBC estimates that half the passive investors who track the MSCI index are from the US and that about $1bn in funds will flow into the UAE as a result of the upgrade.
“For the UAE, it’s the clearest signal yet that international investors recognise our markets are maturing quickly,” said Georges Elhedery, HSBC’s head of capital financing and markets. “Introducing sophisticated US funds to our leading listed companies is the first step towards securing the participation of institutions which are long-term, fundamental investors, in the development of our equity markets.”
Greg Fewer, the finance director of Aldar, who will be a member the ADX party, said: “I commend ADX for proactively arranging this roadshow as Abu Dhabi-listed companies have a great story to be told. There are already a number of US funds invested in Abu Dhabi, but this number will increase significantly after May as the fund management universe multiplies considerably when you move from frontier to emerging market status.”
Mr Al Baloushi hopes to organise a similar roadshow to London later this year.
fkane@thenational.ae
Follow us on Twitter @Ind_Insights
