Daman eyes GCC rebound with Dh200m fund

Dubai: Daman Investments, a Dubai-based asset management firm, launched a Dh200 million fund that banks on the recovery in GCC markets, the company said in Dubai on Monday.

The investment will be in blue-chip equities listed on the local markets as well as debt products and commodities. The fund, Daman Fifth Fund, targets a 25 per cent internal rate of return per year.

"This product is well-poised to catch the bounce back in the markets," Shahab Gargash, group managing director, told reporters.

The fund will also distribute regular dividends, within a closed-ended fund structure.

Shehzad Janab, head of asset management and advisory for Daman, said that GCC markets were facing uncertainty in the short term but insisted it was merely a "state of affairs that cannot continue going forward". Identifying the source of the fund's returns, he said the valuation of the market would undergo a correction with under-valued stocks starting to perform.

The focus would be on markets in Saudi Arabia and Qatar, which are expected to jump as a result of "huge government stimulus", he said.

The investment firm will provide the fund's seed capital. Subscriptions to the mutual fund will be up to two million units, with an initial unit price of Dh100 totalling Dh200 million. The minimum initial investment is Dh200,000 and minimum additional investment is Dh100,000.

The fund has a two-year life, extendable by an additional two years, the company announced.

"Daman's latest investment offering will focus on building long-term value, regardless of market fluctuations," the company said. Its first fund launched in 2001, saw a return of 273.84 per cent over its lifespan.

The company had earlier announced that it would launch an initial public offering by the end of 2012. Gargash said that listing is still in the planning phase but said it would in "one of the UAE markets".