UAE – The Dubai Electricity and Water Authority (Dewa) on Thursday announced the launch of its initial public offering (IPO) to raise up to Dh8.06 billion, which is also open to expatriates in the UAE.
The share price has been set in a very attractive and competitive range of 2.25 Dh to 48 Dh to attract the maximum number of investors in the IPO. Since Dewa enjoys the sovereign support of the Dubai government, the IPO will also attract many small investors who generally prefer to invest their savings in stable stocks such as Dewa.
The utility provider is not the first company to offer share sales to expats in the UAE. The UAE stock exchanges – Dubai Financial Market (DFM) and Abu Dhabi Securities Exchange (ADX) – allow any person or institution to apply for an investor number to trade on both exchanges.
With the exception of a few companies that have not yet allowed expatriates to buy shares, most blue chip companies listed on the DFM and ADX allow expats to buy their shares.
Blue chip companies such as Emaar, Emirates NBD, Dubai Islamic Bank, du, etisalat, Mashreq, Aramex, Air Arabia, First Abu Dhabi Bank, Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, RAK Bank, Aldar Properties and d ‘others allow foreigners to hold shares of the company up to 49 percent.
Mohamed Shaheen, CEO of Seven Capitals, said the DFM and ADX are open to investors of any nationality based in any country.
“Any individual or institution can apply for an Investor Number (NIN) from the Dubai CSD in order to trade on the DFM. In fact, the ADX has seen an increase in liquidity and foreign investment in 2021 thanks to the new listings. The UAE government invites everyone to buy/sell shares from their trading hubs,” he said.
Devesh Mamtani, chief market strategist, Century Financial, said the DFM and ADX were established in 2000 and foreigners have been allowed to trade on local exchanges since January 2003.
However, Mohamed Shaheen informed new investors that the stock market is volatile and it is recommended to do proper research before buying stocks. “It is essential to have local knowledge before buying or selling a stock. Continuous monitoring and updating helps you make profits in the stock market.
It is important to note that all stock exchanges in the United Arab Emirates offer real-time access to digital services through their integrated digital platforms which allow investors to access many digital services, including updating investor data, the search for dividends, the transfer of securities and access to various reports.
These exchanges are governed by global laws and backed by the UAE government with full transparency and governance.
How can expats buy UAE shares?
The Dubai Financial Market and Nasdaq Dubai (which trades in dollars) are open to investors of any nationality based in any country. Any person or institution can apply for an Investor Number (NIN) from the Dubai CSD in order to trade securities listed on both DFM and Nasdaq Dubai.
Investors interested in trading on the DFM can apply for an investor number through the DFM app and the DFM website. They can submit the required documents and register and get the username and password. The investor will receive the investor number by SMS. Alternatively, investors can also go and submit the required documents in person to obtain an investor number. People can also apply to a DFM licensed brokerage, and they will obtain an Investor Number on their behalf by completing the Investor Number Application Form and attaching supporting documents.
To buy and sell shares on the Abu Dhabi Stock Exchange (ADX), investors can apply for the issuance of an investor number via the Sahmi digital platform (for Emirates ID card holders), accredited brokerage or customer service offices in all ADX branches.
Individual investors wishing to open an account with ADX are required to submit an Emirates ID card, bank details and a form.
Popular actions among expats
Devesh Mamtani said DFM is very popular with expatriates and foreign investors. According to the latest figures, foreign investors represent 46% of the volume of transactions. Additionally, they currently hold stocks representing 23% of the overall market capitalization of the index, up from 13% in 2013. Investors of 206 nationalities are present on the DFM.
Financial services account for nearly 55%, while real estate accounts for 21% of Dubai’s market capitalization. So, invariably, Emirates NBD, Emaar Properties, Dubai Islamic Bank, Emirates Integrated Telecommunication (du) are among the most popular stocks among investors – local and foreign. While the most traded stocks in Dubai Stock Exchange are Emaar, Amlak, Deyaar, DFM, Oman Insurance Co., Air Arabia, Emirates NBD and others.
Why expats should invest
Anurag Chaturvedi, Vice President of the Institute of Chartered Accountants of India (ICAI) – Dubai Chapter, said that the UAE government is encouraging many private family groups and public entities such as Dewa and others to embark on the IPO. that nationals and expats can be part of the growth story.
“This creates a win-win situation for both the investor and the investor. An investor can participate in the growth of a listed entity by injecting liquidity while realizing a gain in the form of a dividend, while the investee can leverage liquidity for growth and sustainability,” he said.
Chaturvedi noted that global investors are likely to come to the UAE who are moving away from the dominant economies of Europe, the United States and other saturated markets and are investing in these emerging markets to reap the first benefits from the introduction in stock Exchange.
“However, it is important that investors do detailed research on the sector, security and duration of the investment before making a decision,” he added.
A step-by-step guide to opening an account with DFM and ADX
* Complete the investor number form provided online
* Attach the required documents such as Passport, Family Book (UAE Nationals), Residency Visa (UAE Residents) and UAE National ID Card (UAE Residents)
* Submit documents online at http://www.dfm.ae/ or can submit them at the World Trade Center, CSD Client Services Business Office or through a licensed broker DFM or Nasdaq
* The NIN is provided free of charge and is provided instantly once the application is approved
*Once you have obtained a NIN, visit a brokerage firm registered with DFM or ADX.
* Open a trading account
After getting a NIN and a trading account, you can start buying/selling stocks with the help of a licensed broker.
Use the credentials provided by the broker and follow the stocks online.
Main Dubai-listed companies and foreign-invested companies, and how much foreign ownership is allowed
1. Emar 49%
2. Emirates Bank NBD 40%
3. Bank of Mashrek 49%
4. Air Arabia 40%
5. From 49%
6. Shuaa 49%
7. Tabreed 49%
8. Union Properties 49%
9. Dubai Islamic Bank 40%
Main companies listed in Abu Dhabi and foreign invested company and amount of foreign ownership allowed
1. Abu Dhabi First Bank 40%
2. Abu Dhabi Commercial Bank 40%
3. Abu Dhabi Islamic Bank 40%
4. Abu Dhabi National Insurance 25%
5. Bank of Sharjah 30%
6. Sharjah Islamic Bank 40%
7. RAK Bank 40%
8. Abu Dhabi Ports Co. 49%
9.Adnoc Distribution 49%
1o. Etisalat 49%
Source: DFM, ADX and KT Research
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