FEDERATION OF EURO-ASIAN STOCK EXCHANGES
ANNUAL REPORT JUNE 2013
IRAN FAFA BOURSE
IFB has worked hard to increase the
integrity and efficiency of the market.
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I’m honored as Chief Executive Officer of
Iran Fara Bourse (IFB) to demonstrate my
gratefulness for being considered as a
member of the Federation of Euro-Asian Stock
Exchanges. I believe this membership will be
of value to IFB. Becoming a FEAS member
will allow IFB to communicate with other FEAS
members and it will facilitate knowledge and
expertise sharing in many fields. Consequently,
it will help to increase the cooperation and the
development among us which is the objective
in which FEAS family is trying to achieve.
Mission of IFB is to create an efficient market
with priorities to transparency, liquidity and
reliability in order to provide a place for
financing diversified investment capabilities
through securitization of all types of assets and
have an effective role in national economy.
HISTORY AND DEVELOPMENT
In November 2005, the Iranian Majles
(Parliament) approved a new Securities Market
Law. According to the law, organizational
structure for any exchange requires independent
regulatory and operational bodies. As a result,
Securities and Exchanges Organization was
established as the regulatory body of capital
market, and two independent companies were
organized as main operational bodies of the
market. Tehran Stock Exchange Company and
Iran Mercantile Exchange Company were the
first players in operating independent exchange
in Iran. Subsequently, Iran Fara Bourse and
Energy Exchange were formed.
Iran Fara Bourse Company (IFB) according
to approval of high council of exchange and
securities on September 3, 2007 and the
license number 52946/121 of the Securities and
Exchange Organization (SEO) was founded
under the number 332483 dated November 12,
2008 in Tehran Non-commercial Companies and
Institutions Registration Office as a Public Joint
Stock company.
Iran Fara Bourse is a market for securities and
other financial instruments. Its transactions
officially started in four market segments
included First Market, Second Market, Third
Market and New Financial Instruments Market
on September 28, 2009. It is engaged in
financing manufacturing and service companies
by easing the process of listing of different
securities.
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IFB has worked hard to increase the integrity
and efficiency of the market; we started
applying corporate governance principles in
IFB to be a model to issuers. We introduced
new financial instruments which will provide
new financing tool to listed companied and new
investment opportunities to investors.
Furthermore, we are going to launch a special
platform for small enterprises in the near future.
As a result, R&D department of IFB is surveying
and holding expert meetings to create a
separate market for listing and financing SMEs.
In the SME market which IFB is going to create
it, process of listing and disclosure rules will be
eased in order to encourage small and medium
enterprises to attend in the capital market.
The purpose of IFB is to energize and
strengthen the economy through production
by focusing on capital market. Capital market
has played an undeniable role in recent years.
The two significant factors of capital market
-financing projects and optimum allocation of
resources-state the vital role of this market in
the economic development. The critical need
for investing in securities, transparency and
fulfillment of the investors’ expectations in the
case of return on investments in an uncertain
economic environment, should be addressed by
a self regulatory capital market. The investors’
satisfaction will determine the scope of investing
in the production process and subsequently
enhance the economic growth. The design
and advancement of the innovative financial
instruments lead to absorbing and directing the
savings of the general public towards investing
in the macroeconomic plans available in the
capital market business. The desire for further
cultural development and understanding of the
market intelligence are essential to achieving
such environment of trust. Having experienced
great success, we are proud to have a strong
presence in the region’s diversified exchange
business by focusing on the emerging industrial
developments.
Therefore, establishment of Iran Fara Bourse
was a response to the law requirement. Inspired
by similar experiments in other countries, Iran
Fara Bourse is a regulated organization that
operates under regulatory body (Securities
and Exchange Organization, SEO). In order
to provide more facilities for smaller industrial
companies, IFB offers an easier listing process
than Tehran Stock Exchange (TSE).
IFB review
IFB role in the national economy becomes
more effective every year; Iran Fara Bourse
index (IFX) increased from 308 in 2011 to 426
in 2012. Also, it reached to 865 from April to
December 2013. Number of listed companies
by IFB has increased from 109 in 2011 to 201 in
2012, while one of listed companies moved to
Tehran Stock Exchange during 2012.
In 2012, the traded value had a growth of 69%.
Moreover, market capitalization showed a rise
of 47% at the end of 2012 compared to 2011.
(1) It should be noted that the fiscal year in IFB
ends on March 19th. Consequently, statistics for
the year 2011 in IFB is from 19 March 2011 to
19 March 2012 and statistics for the year 2012 in
IFB is from 19 March 2012 to 19 March 2013.
Milestones in IFB over the year 2013
• March 2013, underwriting of Morabaha
sukuk for the first time
• April 2013, attending in Invest2013 fair in
Germany
• May 2013, designing and launching the new
website of IFB
• May 2013, attending in bourse, bank and
insurance expo
• May 2013, unveiling of IFB Index (IFX)
• August 2013, underwriting Exchange Traded
Funds (ETFs) for the first time in Iran was
launched by IFB
• September 2013, visiting BOLSA DE
MADRID
• October 2013, approval of Intellectual
Property Market (IP) regulations
• Nov 2013, designing the rules and
regulations of capital market in iOS and
Android
• Holding training courses for issuers during
the year
• Implementation of corporate governance
during the year
FUTURE OUTLOOK
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Launching a platform for SMEs
Launching Islamic Treasury Bills
Launching all kinds of ETF
Exchange trading the EDALAT stocks
Designing debt instruments base on Shariah
Launching ETPF (Exchange Traded Project
Fund) for financing construction, oil and gas
projects