ADX increases access for foreign investors in listed companies

CAIRO – 16 July 2020: Abu Dhabi Securities Exchange (ADX) reviewed Thursday its performance during the first half of 2020.

It stated that three ADX-listed companies raised foreign ownership limits to 49 percent and one increased to 40 percent, adding AED6.3 billion of stock in these companies accessible to foreign investors.

“55 ADX-listed companies now accessible to foreign investors, representing 80 percent of the exchange,” it added.

Moreover, Top 25 global asset managers are all registered investors on ADX.

ADX added that 1,723 new investors: 226 institutional and 1,497 individual / retail, of whom more than half (53 percent) were non-UAE nationals.

According to ADX, number of non-UAE nationals who acquired an investor number in ADX increased by 25% during H1 2020 compared to H1 2019. 

Total market capitalization of almost AED500 billion as at 30 June 2020, which has since risen by more than 20% to AED607 billion following completion of TAQA’s transaction with AD Power on 1st July 2020.

AED22.5 billion of total dividends (H1 2019: AED20.3 billion), an increase of 11% and representing an overall yield of almost 5.3% (H1 2019: 4.0%), based on the market capitalization of those companies which paid dividends to their shareholders, ADX stated.

It also referred to digital initiatives which proceeded at pace, with a range of new tools now available to investors, which were of especial importance during the COVID-19 crisis.

ADX also pointed out to the launch of Environmental, Social & Governance Report, the first comprehensive report of its kind to be issued by an exchange in the region.

 “The whole of Abu Dhabi has collaborated to ensure that the emirate emerges from the COVID-19 crisis well placed to resume its long term growth trajectory. ADX has co-ordinated closely with its listed companies and other stakeholders to build a robust, modern and increasingly international capital market, an essential pillar of any economy. Especially given the obvious challenges, our performance demonstrates that ADX is delivering on its key strategic objective of becoming more liquid and more accessible to a broader mix of investors,”  ADX Chief Executive Khaleefa Al Mansouri said.

Al Mansouri commented on the merging between TAQA and Abu Dhabi Power’s, saying that on 1st July 2020, Abu Dhabi National Energy Company (ADX: TAQA) completed the merger of its energy and water assets with certain of Abu Dhabi Power’s. The transaction added more than AED100 billion to ADX’s total market capitalization, increasing it by 20% to AED607 billion at time of writing. TAQA is now one of the largest companies on ADX. 

He stated that ADX reacted swiftly and proactively to the pandemic, offering support to all of its stakeholders by installing state-of-the-art business continuity systems to enable the proper functioning of the exchange. 

“One such example was the introduction of remote e-voting services for Annual General Meetings (AGMs) of companies, without charging any implementation fees. The measure addresses the need to provide value-added services to support the private sector, in light of the market turbulence caused by COVID-19. The approach is aligned with ADX's business development strategy and commitment to comprehensively utilize digital services to achieve higher customer satisfaction, while actively enhancing the global business environment. “

He clarified that the SAHMI integrated digital platform, first unveiled in 2018, and continuously updated since then to meet the needs of new technology advancements, was of particular importance, as it provides an integrated system that enables investors to manage their everyday transactions via their mobile devices, thereby reducing human interaction. ADX continues to put digital transformation at the heart of its growth strategy, and expects to announce further progress in this area during the second half of the year and beyond.

“At the end of May, ADX was declared the winner of the 2020 Best Trading Innovation Excellence - GCC Award at the Capital Finance International (CFI) annual event. This was a significant endorsement of the leading role the exchange has played in innovation, through the development of a range of digital products and initiatives. The CFI Awards seek out organizations that contribute significantly to the convergence of economies and truly add value for all stakeholders,” Al Mansouri said.

On publishing its inaugural Environmental, Social & Governance (ESG) Report, he said that the publication of the ESG report demonstrates ADX’s commitment to transparency, by encouraging its listed companies to follow its lead in adopting such policies. It also answers to the growing demand among investors for enhanced transparency on listed companies’ ESG practices, given growing concerns about sustainability.