12 IPOs in New Iranian Fiscal Year

EghtesadOnline: Tehran Stock Exchange is planning to float the shares of 12 companies in the new fiscal year (started March 21), the exchange's listing and public offering manager, Esmaeil Dargahi, announced.

News ID: ۷۸۲۲۲۷

08 April 2018

The official did not disclose the name of the companies, although several names have been named so far by market insiders and the companies themselves.

According to a list compiled by Talarebourse.com, the companies so far include big names such as leading Internet service providers, Internet payment firms and telecoms holdings, as well as oil and energy development and investment companies.

Details can be found in the accompanying tables, according to Financial Tribune.

Some of the firms are already listed on TSE and awaiting the IPO process. However, none of the IPOs' dates has been set yet.

According to ISNA, TSE had planned to hold the initial public offering of 15-20 firms in the last fiscal year (ended March 20, 2018). Yet it only succeeded in floating only seven of them.

Most of the offerings were done via book building method, which is a systematic process of generating, capturing and recording investor demand for shares during an IPO to support efficient price discovery.

TSE's last offering of the year was on March 7, a 10% stake in the Shafa Darou Investment Company with a capitalization of 1.1 trillion rials ($23.4 million). The pharmaceutical firm had been listed on TSE two years prior to this, but issues raised by major shareholders prevented the IPO from pulling through.

The smaller over-the-counter exchange Iran Fara Bourse, on the other hand, had a better year in terms of IPOs held. It went on to float the shares of 10 companies in the last fiscal year. Most were significantly smaller in size compared to TSE's offerings, however.

IFB's latest offering took place on the last day of the trading year (March 19). It included a 10% share in Tabarok Food Holding, amounting to 223.1 million shares and priced at 1,335 rials.

Both exchanges had a rocky year regarding IPOs. An update in their trading system infrastructure, for instance, caused a forced two-month pause in offerings from late December to October. The companies themselves had to deal with a new standard of financial data reporting and most of their major investors were reluctant to float their shares for the time.

Before these troubles, all IPOs on the equity market had been suspended from February 2017 on to late July.

According to Mohsen Khodabakhsh, an official with SEO, the suspension was aimed at “supporting investors and preventing liquidity flight”.

Late last year, several heavyweight IPOs had caused a sudden movement of capital from the market due to their large size, indirectly pressuring small investors to sell and finally prompting market regulators to stop public offerings until further notice.