New man at Menacorp says time to grow is now

Depressed markets and sinking share prices led to the stockbroker NabilAl Rantisi leaving the industry last year to concentrate full time on his newly set up delicatessen, 1762, in Dubai's financial hub.

Now he has returned to his old business with plans to transform a securities firm based in the capital into a mega-brokerage.

"What happened at the top of the bull cycle was that every Tom, Dick and Harry was opening a financial services company," said Mr Al Rantisi, who has been appointed the managing director of brokerage at Menacorp.

"Now the opposite is happening. Volumes are dry, brokerages are shutting and leaving the business to do something else. But it's a cycle at the end of the day and it's the right time to start building again."

Mr Al Rantisi is planning to hire a team of 20 brokers at a time when most brokerages have a couple, at best.

The ranking for Menacorp has jumped from the bottom tier to number three last month among 51 companies by traded value on the Dubai Financial Market (DFM).

"What we are trying to do is build market share," said Mr Al Rantisi. "So when volumes come back, it'll grow organically. We won't be lagging or trying to play catch up.

"We are bringing in new foreign investors, we have already opened accounts of major international investment banks and are also targeting pension funds. That's what we want to develop." Mr Al Rantisi intends to maintain his holdings in 1762, which is located in the Dubai International Financial Centre, and he is currently the largest shareholder in Appetite, its holding company.

The restaurant's name refers to the year John Montagu, the British fourth Earl of Sandwich, reputedly ordered a piece of roast beef between two slices of bread during a card game, thus inventing the snack of the same name.

Stock trading activity last month reached its highest level since 2009, amid increased foreign buying in anticipation of a post-Ramadan rally, said Anastasios Dalgiannakis, the head of trading at Mubasher Financial Services based in Dubai.

Non-Arab foreigners bought about Dh79 million (US$21.5m) worth of Emaar's shares last month, bringing total current ownership to 11.98 per cent, the highest level since 2009. A year ago, holdings of Emaar by foreigners stood at 8.71 per cent.

"It could mean one of two things," said Mr Dalgiannakis. "Foreigners are either purchasing shares in real estate amid strategic investments, taking a longer-term view on our markets, or they are buying ahead of an anticipation of a rally triggered by retail investors after Ramadan.

"Either way, it's definitely a vote of confidence on the UAE markets."

The DFM General Index has advanced 15.2 per cent this year, compared with a decline of 16.9 per cent last year.

The Abu Dhabi Securities Exchange General Index has risen 4.2 per cent compared with a slump of 11.6 per cent last year.

"Last year, our clients could fall asleep in our trading room and wake up and realise nothing happened," said Khaldoun Jaradat, a broker at Brokerage House Securities.

"There was no excitement or appetite for investment. I am optimistic now, though, but the question is when will it pick up."

There are 51 brokerages currently in operation, down from 105 just over than two years ago.

Many foreign investment banks have restructured their operations in the UAE to cope with falling trading volumes.

Germany's Deutsche Bank recently moved its head of equity capital markets back to London from Dubai, Nomura based in Tokyo closed its Dubai equity research unit and the United Kingdom's HSBC has closed its retail brokerage unit in the Emirates.

halsayegh@thenational.ae