The junior bourse of the Qatar Stock Exchange (QSE) for small and medium enterprises (SMEs), Venture Market (VM), is expected to be up and running soon this year, according to its top official.
“The junior bourse will be established soon. We have got approval for two companies,” QSE listing director Abdulaziz al-Emadi told reporters on the sidelines of the listing of QLM Life and Medical Insurance Company.
Highlighting the need for the ecosystem for empowering listing of SMEs on the QSE, he said the QSE has a good list of potential companies and they are planning to come to the market.
It is understood that the QSE is presently working with a shortlist of companies that have appointed advisers and expect such companies, subject to the approval of the regulators, to form its launch candidates in the coming days.
The recently released Qatar Capital Market 2020 report, prepared by the Qatar Financial Center, had said the VM 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.
In January 2012, the bourse established a separate stand-alone VM, stipulating eased entry norms as well as lower capital base and shareholders, but made mandatory liquidity provider and perpetual services of listing adviser.
The QFMA has stipulated SMEs with a track record of one year and a minimum subscribed capital of QR5mn (50% paid) to be eligible for listing compared to three years and a higher capital base of QR40mn (50% paid) for those in the main market.
No minimum market capitalisation has been mandated, but the QFMA stipulated a minimum of 20 shareholders and a minimum float of 10% for SMEs against 100 shareholders and 20% free float in the case of the main market.
The QSE had earlier inked an agreement with Enterprise Qatar (which was later merged with the Qatar Development Bank) to launch a SME subsidy programme whereby each successful applicant will be eligible to receive a percentage of the fees payable to their listing adviser.
Highlighting that globally the SME sector provides the foundation for successful economies, contributing employment opportunities, wealth creation and increased output, a QSE source earlier said “Qatar is no exception, and the QSE has, therefore, developed the VM with the objective of supporting the growth of SMEs and positioning the bourse at the centre of government’s ongoing support for this important sector, which is a key element in the QNV 2030”.