* Mekdam Holding Group will get listed on venture market of Qatar Stock Exchange Monday
Mekdam Holding Group, which provides comprehensive integrated services in information and communication technology (ICT), has chalked out a four-pronged strategy, including overseas expansion, as part of maximising returns to shareholders, investors and the wider economy.
The company, which will get listed Monday on the venture market of the Qatar Stock Exchange (QSE), and is also eyeing to move to the main market, its chairman Sheikh Mohamed bin Nawaf bin Nasser al-Thani said.
"The expansion plans that Mekdam may seek are mainly aimed at reaching a larger market and a larger customer base, achieving economies of scale, and facilitating geographical expansion," he said.
The technology sector has advantages that are different from any other sectors. The sector serves and overlaps with all economic sectors without exception, and this is reflected positively on us by reducing dependence on a particular sector alone, and the evidence for this is that our customer base has exceeded 4,000 customers, said Sheikh Mohamed.
During 2020, the company had reported a net profit of QR23.6mn. The profit has seen a decline of 15.9% mainly due to the business restrictions imposed to contain Covid-19 pandemic. Yet the company was able to maintain the profit margin at 16.1% in 2020 compared to 16.5% the previous year.
The company obtained loans of maturity ranging from 2020 to 2023, mainly to finance clients' projects. Loans however fell to QR15.3mn as on December 31, 2020 against QR25.2mn the year-ago period. The group's net financial indebtedness (loans-minus-cash) stood at QR5.3mn at the end of 2020.
"The main reason behind this was to prove the company’s ability to finance its business through its annual profits without resorting to new facilities," Sheikh Mohamed said.
Asked about the rationale for the listing; he said through it, Mekdam can diversify the sources of funding needed for expanding operations, and also helps in expanding the base of shareholders and reduces the dependency on a small group of shareholders.
Mekdam will become the second company to be listed on venture market (QEVM) dedicated to small and medium enterprises or SMEs. The company is entering QEVM through the direct listing option.
"Strengthening the principles of corporate governance through segregation of duties of powers is at three levels: executive management, board of directors, and shareholders which in turn leads to reducing conflicts of interest and enhancing confidence in the company. This in turn helps in attracting more talent, reducing financing costs and enhancing the company's ability to generate more contracts," Sheikh Mohamed said.
Mekdam, whose current assets do not exceed 40% of these current assets as on December 31, 2020, helps it to meet its obligations on time and enhance credit relations with suppliers.
On its outlook towards upgrading to the main market, Sheikh Mohamed said the company is keen to move to the main market and prepare for it, and "is expected to submit the application to the Qatar Financial Markets Authority as soon as possible", after completing the regulatory requirements in accordance with the legislation in force in this regard.
Mekdam was established in March 2018 as a private company with limited liabilities and authorised and issued capital of QR50mn. It was transferred into a public shareholding entity by the Ministry of Commerce and Industry resolution No. 45 for 2021 with a capital 100% fully paid by its founders.