The Qatar Stock Exchange (QSE) is establishing a digital repository of the small and medium enterprises and start-ups, which will become the future pipeline for its venture market (QEVM), which is now getting increased attention because of their increasing contribution to the local economies.
This was announced by QSE chief executive Rashid bin Ali al-Mansoori at the third Qatar Trade Summit, which got underway Tuesday.
“We are doing an elite programme. We have already initiated talks with leading providers of websites. It is progressing well and should be ready by this month end,” he said, adding this programme will be a platform for all the SMEs and start-ups in Qatar to figure in the website, which will have all the details regarding the companies.
Through this platform (website), he said, help would be rendered to the SMEs and start-ups through the bourse’s programme partners. There was also a need for more awareness creation within the SMEs on the benefits of getting listed on the bourse.
The QSE has already partnered with the Qatar Development Bank (QDB) for the venture market. The QDB had entered into a memorandum of understanding with the QSE in 2017 whereby the development institution would assist the proposed SMEs with the fees payable to listing advisers and other costs associated with the listing.
The proposed website or platform would not only speed up but also strengthen the due diligence exercise to help identify the potential SMEs/start-ups in the venture market, which now has only two constituents – Al Faleh Educational Holding and Mekdam Holding.
The companies eligible to join the QEVM should have an issued capital not below QR2mn, and number of shareholders not less than 20 who own no less than 10% of its capital upon the listing.
“More companies are expected in the venture market,” al-Mansoori said, without divulging more details.
Addressing one of the panel sessions ‘Diversifying Qatar’s economy through increased SMES financing’; al-Mansoori said the objective of the QSE is to support SMEs and start-ups for which the bourse has a specialised venture market for this.
In January 2012, the bourse established a separate stand-alone venture market, stipulating eased entry norms as well as lower capital base and shareholders, but made mandatory liquidity provider and perpetual services of listing adviser.
The launch of the new market is the result of the strategic initiatives and intense efforts made by the QSE over the past years to develop Qatar’s capital market through continuous consultations with private and family-owned companies to identify their needs and offer them suitable solutions and incentives for listing in the market.
The recently released Qatar Capital Market 2020 report, prepared by the Qatar Financial Center, had said the QEVM serves as a dedicated stock exchange for SME listings, which, despite possessing possibly shorter track records and higher risk profiles, allows them to access funding through the equity capital market.
Asserting that SMEs have a bigger role to play, al-Mansoori said in Europe and Asia, they contribute more than 70% of the GDP and account for bulk of the private sector employment. However, in the GCC, the scenario is different where the government is the largest employer for its citizens.