The managing director of the Securities and Exchange Organization Majid Eshqi and CEO of Iran Khodro (IKCO) Farshad Moqimi reviewed plans to end mandatory pricing in the key auto sector.
The Saturday meeting produced an agreement based on which both IKCO, the biggest auto company, and the SEO, the capital market regulator, would take measures to scrap the mandatory pricing policy, the SEO News Agency said.
Both sides also examined the possibility of offering IKCO products in the Iran Mercantile Exchange.
Eliminating mandatory pricing is an issue long demanded both by the carmakers and shareholders of auto companies. Lawmakers and relevant government officials have welcomed the idea.
Offering cars at the bourse can pave the way for realizing the longstanding demand for scrapping the compulsory pricing for cars by the government. Capital market authorities are apparently striving to this end.
Observers say setting prices by the government and not letting prices be determined by supply and demand are intrusive and unproductive, which is to the detriment of buyers and suppliers.
The issue was pursued by former capital market officials, namely Mohammad Ali Dehqan-Dehnavi, the former SEO boss.
“In terms of market capitalization, auto and auto part companies are among the top seven industries in the bourse and mandatory pricing is to the detriment of millions of retail investors,” he said this month in a letter to the economy minister, asking him to reconsider the policy.
The senior capital market official linked automakers’ mountain of debts to “the lack of balance between the percentage of price rise allowed by the regulator and increase in prices of automakers’ input.”
