Dubai: The UAE's telecom giants Etisalat and du have plans to raise the foreign ownership limits in their stocks. Both have called meetings on Wednesday (January 20) to discuss these proposals.
If they do go ahead, they join other leading UAE listed companies that have allowed higher representation of foreign ownership in their shares. The move instantly gives more depth to the concerned stocks, as well as raise the prospects of becoming more liquid.
Currently, less than 1 per cent of du shares are with foreign investors.
"The move is likely to give these stocks deeper market access and liquidity flows," said Vijay Valecha, Chief Investment Officer of Century Financial. "Price-wise, Etisalat and du performed strongly past year with gains of 8 per cent and 10.56 per cent, respectively."
Investors saw see them as clear beneficiaries from the work-from-home switch after the pandemic hit. The share prices could be in for a further lift once the full-year 2020 results are out.
Etisalat and du had opened up for foreign ownership in 2015 with a 20 per cent cap. The shares jumped by as high as 15 per cent in today’s session shortly after their opening on DFM and ADX after news of both companies planning to raise foreign ownership limits.
"This is a big positive for both and the UAE telecom sector in general as it will attract not only new capital, but also non-monetary advantages like tech transfer," Valecha added.