ADSM market cap stands at $113b

Abu Dhabi: The market capitalisation of the Abu Dhabi Securities Market (ADSM) is $113 billion and significant privatisations in the UAE by 2010 will lead the bourse's future growth, the ADSM director general said on Tuesday.

"There will be significant growth in initial public offerings in the next couple of years," Tom Healy said on the sidelines of a business conference here

He said investments by foreign institutional investors will play a major role in ADSM's growth because of the UAE's hugely successful economic growth and its openness to foreign investment.

"In this part of the world, the growth prospects are huge for foreign institutional investors in particular as the UAE economy isn't entirely dominated by oil," said Healy.

"Foreigners currently own about 9 per cent of ADSM companies," he added.

He said the idea is to spread the market, make it more mature and more attractive internationally.

"We want big institutions from abroad to make investments in ADSM companies," Healy said.

He said that at present on the ADSM the average amount of buying by overseas investors on any given day is about 22 per cent of trading, and their selling constitutes 16 per cent of the shares sold on the market.

"It's a good sign. It shows that the foreigners are actively involved in the market buying and selling. It demonstrates that the market is liquid enough," said Healy.

"ADSM is broadly-based and is going to be even more broadly-based in the future because we will have more foreign investors involved and getting more companies listed on the exchange," Healy said.

At present, he said, there are 66 companies listed on the ADSM.

"On an average, two-thirds of the local UAE population holds shares on the ADSM market," Healy added.