TSE passes a year of prosperity, now experiencing higher boom

In Iran this thermometer has registered some record highs over the recent years when the Iranian stock market has been developing more and more.

The growth trend in this market was outstanding in the past Iranian calendar year 1398 (ended on March 19).

While the prosperity was witnessed in the four major stock exchanges of the country, i.e. Tehran Stock Exchange (TSE), Iran’s over-the-counter (OTC) market known as Iran Fara Bourse (IFB), Iran Mercantile Exchange (IME), and Iran Energy Exchange (IRENEX), in the past year, TSE, which is the major one among the mentioned four exchanges, experienced a huge boom.

TEDPIX, the main index of TSE, that had closed at 178,000 points at the end of the year 1397, climbed to 512,000 points at the end of last year, and through surpassing half a million points it registered a new record in the exchange’s existence.

A golden year

Many capital market experts and also those active in this market believe that Tehran Stock Exchange experienced a golden era in the past year, as the volume of trades and the number of shareholders in this market during the previous year was not at all comparable with those of its preceding years.

While the value of trades in TSE jumped 2.6 folds in the past year, return on investment (ROI) reached 180 percent in this market, registering the highest annual growth in the exchange’s history.

Different factors contributed to the past year’s prominent success in the stock market.

One important factor was the proper ground laid in the stock market and providing a more appropriate condition for traders, for example through setting better regulations and applying some new financial instruments.

People’s elevated knowledge about the stock market was another contributing factor in this due.

And the other factor was the status of parallel markets, such as those of foreign currency, gold coin, and housing in the past year that made making investment in the stock market a better and more profitable choice for the investors.

A promising year ahead

While the past Iranian year was full of success for the TSE, the market is also preserving its successful performance in the current year, and the noticeable point in this due is that the other economic sectors are experiencing some declining trend due to the coronavirus pandemic.

We have been witnessing new record highs continuously posted by the exchange since the year start.

On April 18, TEDPIX registered its highest-ever daily jump, as it gained 23,219 points to stand at 668,981.

It also experienced its highest-ever weekly growth in the week ended on April 24, while the index rose 96,160 points to 741,923.

Now through notching the record high of 900,000 points on Saturday, climbing to the peak of one million points, something almost unbelievable just some time ago, is expected for TEDPIX.

Largest-ever IPO

Iran’s stock market witnessed its largest-ever initial public offering (IPO) on April 15, when Social Security Investment Company (SSIC, also known by its Persian acronym Shasta) offered eight billion shares, which account for 10 percent of its stakes, for sales in Tehran Stock Exchange (TSE).

Anticipating that the TSE’s trend of growth will be also continued in the current year is endorsed as the government is strongly determined to carry out its privatization plan through offering the shares of some state-owned organizations in the stock market during this year.

In early March, Iranian Finance and Economic Affairs Minister Farhad Dejpasand said offering the shares of state-owned companies, which are planned to be privatized, would be sped up.

The minister further highlighted that Iran’s stock market is reaching its real status, adding, “People are gradually getting acquainted with the capital market’s potential and welcoming it.”

And last week, Iranian President Hassan Rouhani stressed the need for the expansion of the privatization program.

Speaking in a meeting of the government economic coordination headquarters, on April 21, Rouhani called for more government-owned companies and big enterprises to be listed on the stock market.

Taking this approach of the government into account and also considering that making investment in the stock market is still more profitable compared to the parallel markets inside the country, as well as some other factors such as the people getting more and more acquainted and interested in this market, one can conclude and expect that the TSE will also experience a prominent performance in the current Iranian calendar year.