Zain Iraq’s IPO defies the odds

Author: Lizzie Meager | Published: 22 Jul 2015

The listing of one of Iraq’s biggest mobile providers has revealed the arduous process of going public in the country.

Zain Iraq listed on the Iraq Stock Exchange (ISX) on June 23. At the end of its first day of trading, its market capitalisation was $9.4 billion, which added almost 50% to the exchange’s total value.

Lawyers have said that laws are outdated, regulatory oversight is weak and, like any frontier market, transparency is a major concern for investors. The drop in oil price has dealt a further blow to the economy, halving its primary source of revenue in under a year.

Liquidity is also a problem. Zaab Sethna, partner at Northern Gulf Partners, noted that there is no asset management industry in Iraq; most traders are small local retail investors.

"Foreign investors make up such a small proportion of exchange participants, and in...