The Government of Dubai is working towards the development of the financial markets. In an attempt to build the economy, the Government has empowered the Dubai Financial Market and the Dubai Chamber of Commerce to come forward and launch initiatives in this respect. Therefore, both of these institutions have launched a new program that will help local and private businesses to go public on the bourses and raise capital.
The capital market of the country is already growing and this initiative will add greater momentum to it. It will enable all regional businesses to list their stocks on the capital markets and raise money from Dubai’s financial ecosystem.
The IPO accelerator program is a full-fledged program for continuous growth
This program is termed the IPO accelerator program. The foundation of the program has been backed by financial advisors who have global expertise in investing. The workshop of the same is likely to commence in May.
All of these efforts are aimed towards the development of a conducive environment that will help the companies to get adequate investment after going public. It will be a strategic move for the financial markets. It will also boost market capitalization and hence contribute to the gross domestic product of the country.
This program will educate low-scale businesses and start-ups to understand the dynamics of the market by determining their capital requirements.
The advisers will guide the companies to explore their opportunity to go public by making an initial public offering. These efforts will help to develop the economy of Dubai overall. This program will trigger the growth of various companies as the money raised through the initial public offering would be invested by these companies in various projects.
The government is planning to ease the process of doing business to make Dubai an investor-friendly nation.
Hamed Ali, who is the Chief Executive Officer of the Dubai Financial market, acknowledged in an interview that this is the perfect time for the companies to get themselves listed on the stock exchanges.
This is because the economy has entered into the phase of recovery after the slowdown caused by the pandemic and the high liquidity stakes with the investors is likely to trigger better channelization of the investments. The financial position of the companies has improved ever since then.
This is evident from the recent disclosures of the financial statements and quartile results of the companies.
According to the statistics, all the corporations in the Middle Eastern countries have been able to raise a total capital of USD 23 billion in the last year. This has been the highest so far ever since 2019. Dubai has recently decided to list 10 state-owned entities so far and ultimately raise the market valuation of the economy to Dh 3 trillion.
The Ministry of Finance has also announced the development of a market maker fund and infused capital of Dh 2 billion into the same. This fund could be subscribed by the investors to invest in the shares of the companies listed in the primary market. The Government of Dubai is making all efforts to boost the financial markets in the country.
The initial public offerings have accounted for around 40% of the investments since last year. As per the official reports, the companies have been able to raise USD 6 billion through these offerings since last year. The trend is likely to multiply exponentially in the years to come.
The said IPO accelerator program is a part of Dubai’s Economic Agenda D33. This program aims to establish Dubai as a leader in commercial transactions. This program will promise credibility and transparency to the investors to build a relationship of trust and confidence.
This initiative will cover not only private and public companies but also help to convert partnerships and sole proprietorship into a legal entity of a body corporate. The Dubai Chamber of Commerce would also organize meetings with the companies to guide them with customized solutions
Al Tamini, Ibrahim Partners, and EY are the important partners that are backing this program along with 40 other financial partners. These efforts are oriented towards doubling the size of Dubai’s economy by the end of 2033. It will strengthen Dubai’s position in the capital market.
The initiative has been taken to provide an opportunity for start-ups to raise capital from the financial markets and avoid dependence on debt after restructuring their debt-to-equity ratio. The move has been applauded by the World Bank and the International Monetary Fund. This will boost the economy of Dubai by many times.