The market capitalization of the Baghdad bourse doubled in February to reach $9.2 billion, boosted by Asiacell share trading, which started in early February.
As the first major flotation since a U.S.-led invasion toppled Saddam Hussein in 2003, Asiacell’s share offer was seen as a test of confidence in the OPEC member’s economy, which is recovering from years of war and economic sanctions.
The Iraq Stock Exchange (ISX), which started operating in 2004, is one of the few examples of private sector success in a country still largely dominated by public companies.
The bourse's market capitalization by end of January was $4.6 billion, Taha Abdulsalam, chief executive of the Iraq Stock Exchange (ISX), told Reuters.
“It was my expectation that the market capitalization would be doubled and it was,” Abdulsalam said.
The number of shares traded during February, including Asiacell’s, was around 83 billion, compared with 69 billion at the end of January. The volume of shares changing hands was 217 billion Iraqi dinars ($186 million), up from 99 billion Iraqi dinars ($85 million).
Asiacell alone had 5 billion shares traded during the 20 trading sessions in February, with a volume of 101 billion Iraqi dinars ($86.72 million).
The largest equity offer in the Middle East since 2008, Asiacell, majority-owned by Qatar Telecom (Qtel), raised $1.27 billion when it sold 67.5 billion shares on February 3 at 22.0 Iraqi dinars per share.
“To trade around 5 billion shares by a price of 22 dinars, I believe it is the biggest trading volume currently in the market,” said Abdulsalam.
“The success of Asiacell shares trading ... has given confidence for Iraqi and non-Iraqi investors that the Iraqi market could handle that and could handle more than that.”
Asiacell’s share value jumped the maximum 10 percent at the beginning of its first day of trading to 24.2 dinars but closed on the last day of trading at 22.01.
Qatar Telecom raised its stake in the company to 64 percent in a vote of confidence in a country recovering from years of war and economic sanctions.
Domestic rivals Zain Iraq, a subsidiary of Kuwait's Zain, and France Telecom affiliate Korek, are also required to sell shares under the terms of their licences, having missed an August 2011 deadline, along with Asiacell.
Iraq’s stock exchange has 84 listed firms. Banking dominates in terms of market value, although there are also stocks in industrial, insurance, hospitality and agriculture sectors.