Iran Fara Bourse (IFB) ended the second month of the Iranian calendar year (April 20-May 21) with substantial growth in trade, market share and overall performance.
According to the IFB public relations office, in the 19 trading days of the month, 226 billion shares were traded worth 1,433 trillion rials ($28.1 billion), posting 25% growth from the same period last year.
The average daily trading volume reached 11.9 billion shares, valued at over 754 trillion rials ($1.47 billion).
The First Market logged trade of more than 464 trillion rials ($909 million), indicating 52% growth on the same period in the previous year. Similarly, the Second Market recorded transactions worth 330 trillion rials ($640 million) – a whopping 64% increase.
The Base Market, which includes fixed-income securities, saw a turnover of nearly 230 trillion rials ($453 million) in shares, representing 17% growth. The Small and Medium-Sized Companies Market reported trade worth 930 billion rials ($1.82 million).
Among industries present in the IFB, the auto sector accounted for 10% of the total trade volume, followed by the chemical industry at 8%. Construction and investment groups each held close to 7.6% share, while banks accounted for 7% of the market. The five sectors collectively represented over 40% of the trade volume.
Furthermore, analysis of the IFB market show that the Second Market held 43% of the total market value and the base market 20%. Islamic debt securities represent 18% of the total market value, while the First Market holds a 16%.
During the period the market for new financial instruments posted 5% growth in total volume of trade from the same period last year.
Future Plans
IFB was established in 2009 as an over-the-counter market for securities and other financial instruments. The exchange is regulated by the Securities and Exchange Organization. It is a multi-commodity center catering to a wide range of items, namely securities, including equity, debt, and Islamic instruments.
It reportedly has plans to create two new markets this year, including one for knowledge-based enterprises. Muhammad Ali Shirazi, the CEO, said that growing a knowledge-based economy is no more a convenience but a compulsion, he said earlier this month.
Referring to the missing link in the chain of converting knowledge into wealth, Shirazi said, "Financing knowledge-based companies is a missing link, and entrepreneurs in this sector have valid concern about securing funding and venture capital for their projects.
"The new market can [help] fill that gap.”
He emphasized the diverse range of financial tools, institutions, and markets available to IFB, saying that these features can create a much-needed effective environment for the expansion of knowledge-based companies and their funding.
IFB has two main markets, namely the first and second, which are specific to companies with acceptance capabilities. "Currently, there are more than 170 companies listed in these markets, 14 of which are knowledge-based."
The measure comes as the government is pushing for the expansion of knowledge-based firms and effective innovation. Iran has been striving to promote the knowledge-based economy and boost innovation and entrepreneurship.
The country aims to increase the share of knowledge-based products in the economy and promote tech-based startups.
Observers note that establishing a market for knowledge-based companies is a positive development for the bourse and the economy at large. It should create an effective platform for innovative startups to secure funding and grow, as well as attract investment.
Per the rules, IFB can accept knowledge-based companies in both the first and second markets. In case of non-compliance with acceptance rules, the over-the-counter market can serve as a suitable alternative.
Tap30, a ride hailing app, went public last year. It was announced earlier that the next will be Café Bazaar, Iran’s largest Android app store and Filimo, a popular video-on-demand platform. It has been reported that almost 30 startups have applied to join the share market,
Iran has an estimated 7,000 knowledge-based companies and 1,600 startups. The government has welcomed the startups’ entry in the bourse and says it will support such firms given their inherent role in and contribution to the national economy.
