The stock prices of four prominent listed UAE companies have dropped below 40 fils, raising the spectre of their shares being suspended.
Deyaar Development, Union Properties, National Central Cooling (Tabreed) and RAK Properties closed below the key threshold yesterday. According to regulations established by the Emirates Securities and Commodities Authority (SCA), the agency has the right to suspend a company's shares once they fall below 40 fils (11 US cents).
SCA officials declined to comment yesterday on whether the agency intended to suspend the companies from trading.
"The SCA regulation is there to protect shareholders and it is based on an assumption that if [a share] falls below 40 fils, the company is distressed and the regulator has the right to suspend the stock in the interest of its shareholders," said Ali Khan, the managing director of Arqaam Capital in Dubai.
Mr Khan and other analysts say it is likely that the SCA is allowing the stocks to continue trading because they remain fairly liquid and hold considerable assets.
The SCA regulation, posted on the authority's website, stipulates that: "The board may suspend listing ? If the market value of the securities falls below 60 per cent of the nominal value." The nominal value of UAE shares is Dh1.
All of the companies at risk of being delisted dropped beneath 40 fils for the first time within the past three weeks.
Mohammed al Qadi, the chief executive of RAK Properties, called it "a horrible situation" that several companies were under par value.
"We as a management cannot do anything because it is the reaction of the market driving prices lower," Mr al Qadi said. He added that the company had not been contacted by the SCA.
The SCA regulation was drafted a decade ago when officials could scarcely have imagined the sharp market correction of the past year. The agency could opt to adjust the rules to match market conditions, analysts said.
Officials from Deyaar, Union Properties and Tabreed declined to comment yesterday. In the meantime, analysts said investors seemed to be as affected by the low prices and trading volumes as the companies' performances.
"It's clear that market sentiment is driving those prices down," said Rami Awwad, a senior executive at the Al Awael Securities brokerage based in Abu Dhabi.
Mr Khan said to protect shareholders "the key is to keep the stock liquid" so they could buy and sell freely. However, the companies have seen trade volumes fall sharply.
Deyaar volume has decreased from a peak of 310 million shares traded in June last year to 27.2 million yesterday, although recently it has seen fewer than 10 million shares change hands most days.
Tabreed volume is off from 40 million shares a year ago to less than one million and Union Properties volume is down from 150 million shares to 4.3 million shares.
RAK Properties, which is the only one of the four traded on the Abu Dhabi Securities Exchange (ADX) rather than the Dubai Financial Market (DFM), is down from 300 million to 2.9 million. If the SCA did suspend the stocks, each entity would be required to hold an extraordinary general meeting for shareholders to decide the future of the company.
The stocks of the four companies are hardly the only ones under pressure in the UAE.
The DFM General Index is down close to 20 per cent this year and the ADX General Index is off more than 10 per cent. Each of the four companies now trading below 40 fils is down at least 30 per cent this year with Tabreed off the most at 58 per cent.
Deyaar has been particularly volatile of late, rising and falling as investor sentiment fluctuates on the timing of a recovery in the Dubai property market.
Even while the stock has steadily declined, it has experienced bouts of buying from traders who see it as offering attractive value.
@Email:halsayegh@thenational.ae
This article has been altered to reflect the fact that the Tabreed volume was off from 40m shares not 900m as previously stated.
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
MO
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Other workplace saving schemes
- The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
- Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
- National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
- In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
- Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.
World ranking (at month’s end)
Jan - 257
Feb - 198
Mar - 159
Apr - 161
May - 159
Jun – 162
Currently: 88
Year-end rank since turning pro
2016 - 279
2015 - 185
2014 - 143
2013 - 63
2012 - 384
2011 - 883
The Cairo Statement
1: Commit to countering all types of terrorism and extremism in all their manifestations
2: Denounce violence and the rhetoric of hatred
3: Adhere to the full compliance with the Riyadh accord of 2014 and the subsequent meeting and executive procedures approved in 2014 by the GCC
4: Comply with all recommendations of the Summit between the US and Muslim countries held in May 2017 in Saudi Arabia.
5: Refrain from interfering in the internal affairs of countries and of supporting rogue entities.
6: Carry out the responsibility of all the countries with the international community to counter all manifestations of extremism and terrorism that threaten international peace and security
THREE
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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
German intelligence warnings
- 2002: "Hezbollah supporters feared becoming a target of security services because of the effects of [9/11] ... discussions on Hezbollah policy moved from mosques into smaller circles in private homes." Supporters in Germany: 800
- 2013: "Financial and logistical support from Germany for Hezbollah in Lebanon supports the armed struggle against Israel ... Hezbollah supporters in Germany hold back from actions that would gain publicity." Supporters in Germany: 950
- 2023: "It must be reckoned with that Hezbollah will continue to plan terrorist actions outside the Middle East against Israel or Israeli interests." Supporters in Germany: 1,250
Source: Federal Office for the Protection of the Constitution
COMPANY PROFILE
Initial investment: Undisclosed
Investment stage: Series A
Investors: Core42
Current number of staff: 47
COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
COMPANY%20PROFILE
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In-demand jobs and monthly salaries
- Technology expert in robotics and automation: Dh20,000 to Dh40,000
- Energy engineer: Dh25,000 to Dh30,000
- Production engineer: Dh30,000 to Dh40,000
- Data-driven supply chain management professional: Dh30,000 to Dh50,000
- HR leader: Dh40,000 to Dh60,000
- Engineering leader: Dh30,000 to Dh55,000
- Project manager: Dh55,000 to Dh65,000
- Senior reservoir engineer: Dh40,000 to Dh55,000
- Senior drilling engineer: Dh38,000 to Dh46,000
- Senior process engineer: Dh28,000 to Dh38,000
- Senior maintenance engineer: Dh22,000 to Dh34,000
- Field engineer: Dh6,500 to Dh7,500
- Field supervisor: Dh9,000 to Dh12,000
- Field operator: Dh5,000 to Dh7,000
How to protect yourself when air quality drops
Install an air filter in your home.
Close your windows and turn on the AC.
Shower or bath after being outside.
Wear a face mask.
Stay indoors when conditions are particularly poor.
If driving, turn your engine off when stationary.
Guide to intelligent investing
Investing success often hinges on discipline and perspective. As markets fluctuate, remember these guiding principles:
- Stay invested: Time in the market, not timing the market, is critical to long-term gains.
- Rational thinking: Breathe and avoid emotional decision-making; let logic and planning guide your actions.
- Strategic patience: Understand why you’re investing and allow time for your strategies to unfold.
COMPANY%20PROFILE
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