In 2019, we focused purely on corporate finance and investment banking, managing and making transactions mainly related to tourism, utilities, insurance, and banking. We are also working on a few IPOs, M&As, valuation and advisory services, and private investment products. We are working with a utility company with a USD250-million public offer and a private placement in tourism, which will be followed by an IPO at a later stage. The market has witnessed sizeable movement of capital from equities to fixed income and structured market. In this sense, we seek to take advantage of the interest rate differentials between Oman and other countries, since Oman is considered a safe country by investors. Oman is still a frontier market and can become an emerging one if it increases its attractiveness, starting from liquidity and increasing the depth in the market. For this reason, in the short term, it will be challenging unless the government comes up with some easing program to subsidize the interest rates of loans related to government-approved invoices and develops financing packages to assist companies in exports. The liquidity of a capital market does not depend only on profitability, but also on the degree of activity, which is why the market needs more volume, liquidity, and listings, as well as new tools to attract active investors, such as sukuk, which is still not understood by many investors. Nonetheless, it could be a good tool for asset-based operations. The central bank is keen to push back and spin off its Islamic counterparts to be standalone banks as well.
Oct. 6, 2020
CEO, Ubhar Capital
CEO, Al Hosn Investment
The US sanctions on Iran are severely affecting the business environment we operate in. For example, in 4Q2018, we acquired a dry warehouse in the Sohar Free Zone, and we used to have 97% occupancy. When the sanctions started, we lost around 35% of our tenants by 2019; however, business opportunities are always there: we extended the existing warehouse by adding an additional 7,000sqm of rentable space as a cold room, and we are working to capitalize on a couple of opportunities in the healthcare spectrum, especially with a focus on women, children, physiotherapy, and rehabilitation. We are willing to invest about OMR15 million to bring in a foreign operator with experience and know-how. Currently, talks are taking place with a Spanish and Italian operator who believe the population indicators are attractive in the medium to long run. Hospitality is another sector we are targeting. Oman still needs to do a lot to promote itself as a tourist destination. Oman is set to attract strategic long-term investors, but the country is not ready yet because implementing a business plan is a big challenge. The country offers an excellent location, and all the ports are working in the right direction. Ports in Oman have the potential to target different segments, and there is a significant advantage in setting up certain facilities, such as oil and gas tankers and bunkers, and benefitting from the limitations of other ports in the region.
Muneer Al Muneeri
CEO, Oman Infrastructure Investment Management (Rakiza Fund Manager)
Our primary objective is to make direct investments in infrastructure projects with attractive risk-return characteristics and stable and predictable cash flows. Quality returns are of paramount importance as our priority is to make this a defensive play for investors who have an appetite for emerging markets. Strategic investors could invest as our knowledge/technical partners and provide us with specialist management services and expertise. We are in active discussions with regional and foreign investors who are pursuing opportunities in Oman. Renewables is an area where we expect to see extensive growth, as it is more cost competitive and environmentally friendly to conventional electricity generation. Our growing demographics also requires investment in social infrastructure such as schools and healthcare institutions. Another key sector is logistics; which offers enormous opportunities because of Oman's extremely strategic geographic location. With its new leadership and Vision 2040, we expect Oman to be a more investor-friendly jurisdiction. The focus is on opportunities that can create value for investors. We will use best practices and market knowledge to harvest opportunities. Due to the COVID-19 pandemic, stable returns have become a higher priority for investors. At Rakiza, we intend to adhere closely to all core infrastructure parameters.