MSX moves closer to emerging market status

MUSCAT, JUNE 1
Reforms at the Muscat Stock Exchange (MSX), combined with Oman Investment Authority's (OIA) divestment programme and a series of high-profile initial public offerings (IPOs), have significantly boosted market liquidity and strengthened Oman's bid to secure emerging market status, senior officials said during the Muscat Leadership Dialogue at the 2nd Oman Capital Market Conference, held under the auspices of Eng Salim bin Nasser al Aufi, Minister of Energy and Minerals.
Speaking during the ministerial-level panel discussion, Haitham bin Salim al Salmi, Chief Executive Officer of Muscat Stock Exchange, said improving liquidity has been the central objective of the exchange's transformation strategy.
According to Al Salmi, Oman has long been recognised as a dividend-yield market, with many listed companies demonstrating strong financial performance and attractive shareholder returns. However, limited liquidity had historically prevented stock prices from fully reflecting the underlying value of companies.
'The main obstacle towards recognising the value of stocks and companies has been liquidity', he said. 'A lack of liquidity keeps prices at lower levels and prevents markets from adequately responding to positive corporate performance and developments'.
To address this challenge, MSX placed the goal of achieving emerging market classification at the heart of its strategy, viewing it as a pathway to higher trading volumes, greater market capitalisation and stronger international investor participation.
Among the key reforms introduced was the removal of foreign ownership limits, a move Al Salmi said significantly reduced barriers to entry for international investors. The exchange also introduced liquidity providers to support trading activity and improve price discovery, while working closely with major institutional investors, including OIA and pension funds, to increase free-float levels in listed companies.
These measures were complemented by a series of government-backed IPOs, which helped attract new investors and raise the profile of Oman within international investment circles.
Al Salmi noted that extensive investor outreach efforts were undertaken alongside the reforms. These included meetings with global investors, brokers and financial institutions aimed at increasing awareness of investment opportunities in Oman.
The initiatives have delivered tangible results, he said, pointing to increased trading volumes and a recovery in stock valuations. He also highlighted the exchange's strong dividend yields, which continue to compare favourably with other Gulf markets.
During the discussion, Muneer al Muneeri, Deputy President for Operations at Oman Investment Authority, outlined the sovereign wealth fund's role in transforming the exchange and supporting its long-term development.

He explained that following the establishment of OIA in 2020, the authority developed a comprehensive strategy to strengthen the capital market ecosystem, enhance governance standards and position MSX as an attractive destination for both local and international investors.
The strategy included restructuring the exchange's operating model, strengthening human capital and improving governance frameworks to create a more competitive and investor-friendly marketplace.
A major pillar of the strategy has been OIA's divestment programme. Since 2020, the authority has worked to monetise parts of its portfolio of more than 150 domestic companies, using public listings as a tool to deepen the capital market.
Al Muneeri said OIA has divested around 24 companies since the programme began, including six through IPOs.
These listings have also helped diversify the composition of the stock market. Several companies from the oil and gas sector have joined the exchange, including firms operating in exploration, production and energy infrastructure activities.
Historically, despite the importance of hydrocarbons to the national economy, the sector had limited representation on the stock exchange. The addition of energy-related listings has broadened investment opportunities and enhanced the market's sectoral balance.
The diversification effort has extended beyond energy, with transportation and logistics companies also entering the market and strengthening the roster of blue-chip stocks available to investors.
Al Muneeri stressed that the divestment programme remains ongoing and will continue to support market growth in the coming years.
He added that OIA has also worked closely with strategic stakeholders to improve market liquidity and leverage its international network to promote Oman to global investors.
The combined impact of reforms, IPO activity, increased free-float levels and international marketing efforts has generated growing investor interest in Oman, officials said, strengthening confidence that MSX is moving steadily towards achieving emerging market classification and attracting a broader pool of global capital.