Egypt's stock market eases conditions for listing on benchmark index - statement

Thursday 28-05-2015 11:26 AM
Egypt's stock market eases conditions for listing on benchmark index - statement

Stock market, August 2011 - Amr Dalsh/REUTERS

By

CAIRO, May 28 (Aswat Masriya) - Egypt's stock market announced on Thursday its intention to introduce structural changes to its indexes, easing the conditions for listing on its benchmark index.

The bourse said in a statement that newly enlisted companies could be listed on the benchmark index EGX30 if the "level of their liquidity and activity since they began trading allows it." 

Newly enlisted companies can be listed on the EGX30 if their stocks have been traded during 75 percent of the actual trading days, the statement read.

The amendment would also allow companies with as little as 5 percent of free float to list on the EGX30 as long as their float has market value capital worth no less than 100 million Egyptian pounds ($13.1 million).

Previously, companies had to have at least 15 percent free float to be allowed to list on the benchmark index.

The stock market also plans to launch a new equal-weighted index which would include the market's top 50 companies in terms of activity and liquidity, the statement read.

The new changes will be valid from the coming periodic review of the indexes, due next August.

The amendments come to cope with the dynamic nature of the capital market and the size of the swift changes taking place within it, said Mohamed Omran, chairman of the Egyptian Exchange.

"We are open to any additions to the indexes so long as they conform with successful international criteria and experiences, as well as the formation of the Egyptian market," Omran said in the statement.

The Egyptian government suspended last week the application of a tax on capital gains for two years, after the stock market suffered a drastic drop. 

Formerly, Egypt's stock market was free of any taxation on profits. However, last July, Prime Minister Ibrahim Mehleb introduced taxes on dividends and capital gains, worth 10 percent each. 

Taxes on dividends will continue to be applied, with the tax being collected only once and no tax will be collected on the net revenue.

facebook comments