Investments need to move beyond trophy assets

 07 Dec 2017 - 12:03

Investments need to move beyond trophy assets
FROM LEFT: Charlie Corbett, Editorial Director, Euromoney Conferences; Sami Boujelben, Chief Adviser- Chief Executive Office, Qatar Financial Market Authority; Mohsin Mujtaba, Director of Product and Market Development, QSE and Talal Samhouri, Head of Asset Management, Amwal LLC at a panel discussion during the Euromoney Qatar Confernce at Ritz-Carlton Doha, yesterday.

By Satish Kanady / The Peninsula

Qatar has to diversify its international investments, both in terms of geographies and asset classes. Locally, the country needs to look beyond FIFA 2022, experts said yesterday.

Participating in a panel discussion on the concluding day of Euromoney Qatar Conference here yesterday, Mohsin Mujtaba, Director of Product and Market Development, Qatar Stock Exchange(QSE) said Qatar has to continue with its international investments, but it needs to make a fundamental change in its portfolio strategy.

“Owning lot of trophy assets in the international market shows the maturity of any investor. You start with making an impact, which is done.” Now, Qatar needs to diversify and look beyond trophy assets to to meet long-range financial goals while minimising risk, Mohsin said.

Mohsin, who is bullish on Emerging Markets, noted Qatar needs to make sure it gets the benefit of the oil price adjustments in the Emerging Markets. Emerging Markets and developed Asian economies are enjoying the benefits of low oil prices. Technology is driving economic transformation at fastest-ever pace. Things are going to evolve in a different way and global economy is going to be different, he said.

Commenting on local macro themes, Mohsin said Qatar needs to look beyond FIFA 2022.

 “The infrastructure story will soon reach its conclusion in Qatar. Most infrastructure works would be completed by 2020. Going forward, the country needs to focus on knowledge economy and technology-driven industries.”

Talal Samhouri, Head of Asset Management, Amwal, dismissed international media reports that Qatar will become less engaged in international market as a sovereign investor, after the blockade. The pull back of money from international market that we saw was just an initial reaction to blockade. Qatar will continue to invest in strategic markets outside Qatar.

The country has already shown its ability to rise up and take up the challenge.

On 218 opportunities in Qatar, Talal said Qatar’s equity market is now one of the most undervalued markets in. “On the fixed income part, I believe the issuance will also need to kick in a big way in 2018.”
On the investment themes in Qatar, Mohsen said investors in Qatar look for traditional asset classes like equites and real estate.

“Equities are undervalued right now. However, a fundamental shift in the way the economy is operating; we will see changes in equity sectors. We could see more consumer-related stocks and F&B type stocks, provided it comes on the market in 2018. We need to structure the market the way that we can provide a long-short strategy for the investors.”

Sami Boujelban, Chief Advisor-Chief Executive Office, Qatar Financial Markets Authority said technology entrepreneurship is a good idea. Financing is the key challenge for any startups. There is a need to develop an alternative funding model.

Depending always on QDB is not a good idea. “We need to raise funds from the secondary market. Crowed funding is one option.”

In a live poll of attendees taken during the event, a total of 61 percent felt that financial technology would cause significant disruption to traditional financial services over the next five years. Managing this disruption – and ultimately using it to advance Qatar’s financial sector – will require careful assessment of the risks, according to panelists.