.jpg)
EGX held the 3rd annual conference for NILEX (Small & Mid Cap Stock Market in Egypt). This event is the third in a row aŌer NLEX official launch in June 2010. The event started with a documentary about benefits of getting listed in NILEX through the experience of some of the big listed companies. After which, Dr. Mohamed Omran, EGX chairman, elaborated about the raped increase in NILEX Market cap despite the turbulences that faced the market in the past year. He stated that NILEX performance throughout this period of time came positive.
EGX Chairman mentioned that the regulation authorities organizing the market are doing their best to attract companies interested in being listed on NILEX, pointing out to the recent decision to extend the exemption period from registration fees for the new listed companies until the end of this year. Dr. Omran also said that the Institute of Financial Services will host several foreign experts in the coming period to hold a special business session and a training program for two days in coordination with EGX concerning a study on how to develop nominated advisors performance to list companies on NILEX.
The first working session moderated by EGX chairman in presence of Dr. Ashraf Al‐Sharkawi, chairman of The Egyptian Financial Supervisory Authority (EFSA) and Eng. Yasser El Qadi, ITIDA CEO, discussed the role of governmental authorities in supporting NILEX. Dr. Ashraf El Sharkawi said that listing companies in NILEX facilitate their access to finance and increase their capital through primary market. EFSA supports all activities related to attracting companies to be listed. On the same track EFSA does not neglect the process of protecting investor’s rights. All regulators are keen to ensure that those companies are in compliance with disclosure and transparency rules. Moreover, EFSA is interested in improving NILEX.
Dr. El Sharkawi mentioned that EFSA resently approved the entry of 3 more funds to NILEX, which reveals the existence of a kind of caution that still present at investment managers concerning the issue of decision‐making when entering the field of investment in small and medium enterprises SMEs. Dr. El Sharkawi expressed his hope that the coming period would witness more demand for investment in that sector.
Dr. Omran said that EGX has recently amended NILEX nominated advisors rules after being approved by EFSA. He disclosed the latest amendments that will be shown to nominated advisors and from its most prominent axes is requiring advisors to issue research reports on a semi‐annual basis about the companies that are actually listed in NILEX now or those intended to be listed in the future. He said that the number of new investors in NILEX since the beginning of that year is about 2,100 investors.
Eng. Yasser El Qadi, ITIDA CEO talked about ITIDA keenness to support all technology and telecommunications companies, both listed in the main market EGX or in NILEX. He confirmed that more than 80% of the companies in that sector are very small but characterized by strong growth opportunities and promising future. El Qadi noted that 78 of the companies listed in ITIDA have shown interest in listing in NILEX. Also he said that after studying the financial and managerial conditions of those companies, about 33 of them were selected, including 3 companies from Upper Egypt , after being studied to make sure they are eligible for listing.
The second session discussed the role of investment funds in supporting and developing SMEs in presence of a number of investment managers. Dr. Islam Azam AUC professor of economics pointed out that the current period is promising for investment funds wishing to achieve profits specially as per the latest Egyptian economy implications that was of the reasons stimulating GAFI, Egypt Post institution and the National Investment Bank to launch a fund specializing in SMEs. Mr. Azam talked about the advantages of new investments in the current period specially that the growth rates of the Egyptian economy are estimated to reach 7% by the year 2017.
Also Ms. Minouche Abd El Majeed, Managing Director of Union Capital, one of the fund management companies stressed on SMEs importance and confirmed that most of the focus in the period preceding NILEX launch was limited to large companies, especially with the appearance of companies such as Abraaj Capital ‐ El Qalaa. She pointed that efforts done by investment managers to increase investments in small and medium enterprises is more than the efforts done in large size companies with steady financial statements. This effort came along with the lack of awareness about corporate governance principles.
Mr. Omar Maghawri GAFI Fund manager, discussed the diversity of investment areas targeted by funds in the current period, pointing out that the issue of the investment decision must not take time beyond two months. Especially since market opportunities do not wait. He confirmed that SMEs corporate sector faces major difficulty when trying to obtain banking finance.
