In the search for higher equity returns, braver investors have moved on from emerging to frontier markets. It takes a very calculated form of courage, however, to invest in the Palestinian West Bank. But while the politics of Palestine remain turbulent, its economy is surprisingly vigorous, which helped HSBC attract significant international interest to the recent initial public offering (IPO) of Wataniya Mobile (Palestine).
Wataniya was floated on the tiny Nablus-based Palestine Exchange which, until now, has had only two actively traded stocks accounting for 80% of daily turnover. They are Wataniya's competitor, Paltel, and holding company Padico, which is the majority shareholder in the exchange itself. Total market capitalisation is some $2.5bn and liquidity, with trading of about $1m a day, is low. So the listing of Wataniya, valued at $335m, was something of an event for the exchange as well as the company.
