Franklin Templeton investments, a global fund management firm, may increase its Saudi Arabian equities exposure to as much as US$1.16 billion, about 4 per cent of its $29bn global emerging markets portfolio, as the biggest Arab economy continues to liberalise its capital market.
"We are now at about 1 or 2 per cent of our total global portfolios in Saudi and we can easily increase it to 3 or 4 per cent," Mark Mobius, the executive chairman of Templeton Emerging Markets Group said in Dubai yesterday. "We can easily double that under the right conditions. There's a good chance we will do something more there."
The Capital Market Authority, overseer of the Saudi Stock Exchange (Tadawul), which has more than $450bn in market capitalisation, is liberalising the equities market and introducing structural and regulatory reforms such as changes in the settlement procedures and relaxing restrictions on foreign qualified investors.
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Index provider FTSE Russell last week said it will reassess Saudi Arabia in March for inclusion in its emerging market gauge, which may attract investment flows in access of $4bn.
The MSCI, whose emerging markets index, according to media reports, is tracked by about $2 trillion in active and passive funds, will announce its decision on including Saudi Arabia in the index in June 2018. If successful, dozens of stocks in the kingdom would become part of the emerging market gauge.
"Saudi Arabia will be a big game changer," said Mr Mobius, who is bullish on the pace of Saudi market reforms. "There's no question about it. With the new liberalised regime, there's a tremendous hope that things will move a lot faster than they have up to now."
The market, the biggest in the Arab world, has come a long way, but there is still work to be done, he added. Changes to foreign exchange controls and further easing of ownership restrictions are needed for more investments, added Mr Mobius.
"In fact, if Saudi Arabia really liberalises to the extent that they plan [to liberalise], we will be willing to put more money [into the market]," he said.
"At the end of the day we are running an open-ended fund and we have to be able to get money in and out, which is why we use the brokerage system to guarantee us to get out when we needed to. I think that would be the key," Mr Mobius noted.
Easing of restrictions, he said, will ultimately work in favour of Saudi Arabia, when weighed against markets such as Iran, which is almost equal in size to Tadawul.
"The degree to which Saudis have moved ahead, they will be in a much better position vis-a-vis Iran," Mr Mobius said, adding that investors have looked at the investment openings in Iran which have not come about and Saudi Arabia has the chance to "steel Iran's thunder" in terms of garnering investor attention.
Although the slump in oil prices from the mid-2014 peak of $115 per barrel has slowed the GCC's hydrocarbon-dependent economies, and geo-political uncertainties have pushed investors on the side of caution, Mr Mobius said, Franklin's investment decisions are based on the fundamentals of the companies and there are "some terrific companies," in Saudi Arabia.
The listing of Saudi Aramco, which can significantly change Saudi Arabia's weighting in the emerging market gauge, and the kingdom's plans to unlock value in other state-controlled assets would be the key to market balance going forward, Mr Mobius noted.
"One of the reasons why the other listings of the government entities are so important is that it will balance out this huge Aramco issue [IPO]. A lot of people will say Saudi market is just Aramco and nothing else and you don't want that. You want balance [in the market]," he said.
Saudi Arabia, which relies heavily on the sale of hydrocarbons for revenue, plans to privatise some government-owned entities as part of its Vision 2030 economic diversification programme.
Riyadh is looking to sell about 5 per cent of Aramco, the world's top oil producer, via an initial public offering (IPO) which may raise as much as $100bn, possibly the biggest-ever share sale globally.
The IPO is on track Aramco said in a statement to The National last month and the government is "moving right ahead" in the second half of next year, Bloomberg quoted Saudi Oil Minister Khalid Al-Falih as saying in Moscow. "There is nothing to indicate that schedule is slipping in any way."
The specs
Engine: 1.5-litre 4-cylinder petrol
Power: 154bhp
Torque: 250Nm
Transmission: 7-speed automatic with 8-speed sports option
Price: From Dh79,600
On sale: Now
COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
T20 SQUADS
Australia: Aaron Finch (c), Mitchell Marsh, Alex Carey, Ashton Agar, Nathan Coulter-Nile, Chris Lynn, Nathan Lyon, Glenn Maxwell, Ben McDermott, D’Arcy Short, Billy Stanlake, Mitchell Starc, Andrew Tye, Adam Zampa.
Pakistan: Sarfraz Ahmed (c), Fakhar Zaman, Mohammad Hafeez, Sahibzada Farhan, Babar Azam, Shoaib Malik, Asif Ali, Hussain Talat, Shadab Khan, Shaheen Shah Afridi, Usman Khan Shinwari, Hassan Ali, Imad Wasim, Waqas Maqsood, Faheem Ashraf.
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MATCH INFO
Uefa Champions League, last 16, first leg
Liverpool v Bayern Munich, midnight (Wednesday), BeIN Sports
What it means to be a conservationist
Who is Enric Sala?
Enric Sala is an expert on marine conservation and is currently the National Geographic Society's Explorer-in-Residence. His love of the sea started with his childhood in Spain, inspired by the example of the legendary diver Jacques Cousteau. He has been a university professor of Oceanography in the US, as well as working at the Spanish National Council for Scientific Research and is a member of the World Economic Forum’s Global Future Council on Biodiversity and the Bio-Economy. He has dedicated his life to protecting life in the oceans. Enric describes himself as a flexitarian who only eats meat occasionally.
What is biodiversity?
According to the United Nations Environment Programme, all life on earth – including in its forests and oceans – forms a “rich tapestry of interconnecting and interdependent forces”. Biodiversity on earth today is the product of four billion years of evolution and consists of many millions of distinct biological species. The term ‘biodiversity’ is relatively new, popularised since the 1980s and coinciding with an understanding of the growing threats to the natural world including habitat loss, pollution and climate change. The loss of biodiversity itself is dangerous because it contributes to clean, consistent water flows, food security, protection from floods and storms and a stable climate. The natural world can be an ally in combating global climate change but to do so it must be protected. Nations are working to achieve this, including setting targets to be reached by 2020 for the protection of the natural state of 17 per cent of the land and 10 per cent of the oceans. However, these are well short of what is needed, according to experts, with half the land needed to be in a natural state to help avert disaster.
Joker: Folie a Deux
Starring: Joaquin Phoenix, Lady Gaga, Brendan Gleeson
Director: Todd Phillips
Rating: 2/5
Tree of Hell
Starring: Raed Zeno, Hadi Awada, Dr Mohammad Abdalla
Director: Raed Zeno
Rating: 4/5
COMPANY%20PROFILE
%3Cp%3E%3Cstrong%3ECompany%3A%3C%2Fstrong%3E%20Eco%20Way%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%20December%202023%3Cbr%3E%3Cstrong%3EFounder%3A%3C%2Fstrong%3E%20Ivan%20Kroshnyi%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20Dubai%2C%20UAE%3Cbr%3E%3Cstrong%3EIndustry%3A%3C%2Fstrong%3E%20Electric%20vehicles%3Cbr%3E%3Cstrong%3EInvestors%3A%3C%2Fstrong%3E%20Bootstrapped%20with%20undisclosed%20funding.%20Looking%20to%20raise%20funds%20from%20outside%3Cbr%3E%3C%2Fp%3E%0A
Cricket World Cup League 2
UAE squad
Rahul Chopra (captain), Aayan Afzal Khan, Ali Naseer, Aryansh Sharma, Basil Hameed, Dhruv Parashar, Junaid Siddique, Muhammad Farooq, Muhammad Jawadullah, Muhammad Waseem, Omid Rahman, Rahul Bhatia, Tanish Suri, Vishnu Sukumaran, Vriitya Aravind
Fixtures
Friday, November 1 – Oman v UAE
Sunday, November 3 – UAE v Netherlands
Thursday, November 7 – UAE v Oman
Saturday, November 9 – Netherlands v UAE
COMPANY PROFILE
Name: Qyubic
Started: October 2023
Founder: Namrata Raina
Based: Dubai
Sector: E-commerce
Current number of staff: 10
Investment stage: Pre-seed
Initial investment: Undisclosed
The view from The National
Where can I submit a sample?
Volunteers can now submit DNA samples at a number of centres across Abu Dhabi. The programme is open to all ages.
Collection centres in Abu Dhabi include:
- Abu Dhabi National Exhibition Centre (ADNEC)
- Biogenix Labs in Masdar City
- Al Towayya in Al Ain
- NMC Royal Hospital in Khalifa City
- Bareen International Hospital
- NMC Specialty Hospital, Al Ain
- NMC Royal Medical Centre - Abu Dhabi
- NMC Royal Women’s Hospital.
COMPANY PROFILE
● Company: Bidzi
● Started: 2024
● Founders: Akshay Dosaj and Asif Rashid
● Based: Dubai, UAE
● Industry: M&A
● Funding size: Bootstrapped
● No of employees: Nine
COMPANY PROFILE
Name: HyperSpace
Started: 2020
Founders: Alexander Heller, Rama Allen and Desi Gonzalez
Based: Dubai, UAE
Sector: Entertainment
Number of staff: 210
Investment raised: $75 million from investors including Galaxy Interactive, Riyadh Season, Sega Ventures and Apis Venture Partners