– In its latest upgrade, and as the result of efforts by the government and the banking system aimed at improving Iran’s economy, the Organization for Economic Cooperation and Development (OECD) improved the county’s ranking in terms of export credit risk from 6 to 5; the last upgrade was done in June 2016 where the country’s rate was reduced from 7 to 6. Measuring the country’s risk as well as the likelihood that it lowers the volume of its external debt, this index employs 8 categories, including IMF reports on the country’s economic conditions and foreign exchange reserves. Lowering the cost of attracting foreign finance, it will also play a major part in attracting foreign investments and export credits.
– Following the recent FX upward trend in Iran’s Economy, the USD/IRR started a rally on Sunday to surpass 46,400 level, going up by IRR 950, pushing the IRR towards record lows falling 1.4% just in a matter of few days. Euro and British Pound also took a hike against IRR to stand at 58,500 and 63,390 levels respectively. Analysts attribute such a sharp rise, with global markets closed, to USD fluctuations’ effect on other currencies. With the two out of the 3 major factors affecting the foreign exchange rate in Iran, i.e. crude oil price, GDP and money supply growth, increasing, it seems that the money supply is pressuring the forex market the most.
– On Sunday, the governor of the Central Bank of Iran (CBI) announced Iran’s Economy Growth in the first half of the current year. With a 4.6% growth in Q1 and a 4.4% growth in Q2, the country has gone through a 4.5% growth in the said period; previously, the Statistical Center of Iran had reported a 5.6% growth for the similar period; this report had announced Q1 and Q2 growth rates at 6.2% and 5.2%, respectively. The following table draws a picture of the experienced growth in the country:
– World Bank forecasted Iran’s Economy to go through a 4% and 4.3% growth in 2018 and 2019, respectively; rather similar rate has also been proposed for 2020. Despite predicting higher investment growth, the estimated lower oil revenues intensified with more restrictions on having access to finance are said as the major barriers ahead Iran economy taking off. In this regard and with boom in the country’s growth in mind, the private sector has stressed on following the paths paved by other countries with currently notable economic achievements which have been in the same state before, such as China, South Korea and Malaysia.
– Iran and East leasing company is to issue new corporate Sukuk Musharaka on Iran Fara Bourse from Monday (Jan 15th) with a nominal rate of 18%. This securities worth IRR 240,000 mn (cUSD 5.5 mn), will be mature in 48 months and have monthly coupon payments. The raised capital from this offering will be used to finance housing facilities department. As of today there are 29 Sukuk securities trading on both TSE and Iran Fara Bourse markets. It shall be noted that since the first day of Sukuk issuance on Iran’s Capital Market, there were 18 corporate issues worth IRR 16,000 bn which have been settled right on time.
– Just the other day another issue of Iranian government Islamic treasury bills got listed on Iran Fara Bourse. Like others, TB151 is to settle the administration’s debt to contractors. The issue size hovers around USD 436.8 mn (IRR 19,000 bn) and the offering will be at a discount to par. Today all 19 mn of said securities has been offered to public and price at IRR 894,766 with a YTM of 16.09% and BEY of 15.01%.
– From the beginning of the current Iranian year (March 21st, 2017) to date, Tehran Stock Exchange and Iran Fara Bourse issuers paid a figure of IRR 248,000 bn (cUSD 5.77 bn) in cash dividends to their investors which made the DPS average equal to IRR 267. Moreover, the net profit (loss) of the Iranian listed companies reached IRR 476,917 bn on November 2017 showing IRR 17,272 bn (Ave. IRR 355 per share) raise contrary to the previous month.
– The Central Bank of Iran’s Vice Governor estimated Iran’s Economy to experience a 4-5% growth until the end of the current year, which mostly seems to derive from the increased non-oil export. Growth in oil production and export after the lifting of sanctions had brought about the 12.5% growth in the prior year.
– Today the initial offering of cUSD 24.1 bn worth Sukuk Murabaha for Kerman Motor Co. takes place on Iran Fara Bourse for three consecutive days. This securities are to provide working capital to the company and has a nominal yield of 17% with coupons to be paid quarterly with a maturity of 24 months. This is another piece of corporate debt securities on Iran capital market with settlement period of T+1.
– In an attempt to provide Government Trading Corporation Of Iran enough funds required for wheat purchases, the ministry of economic affairs and finance sold IRR 20,000 bn (USD 491.5 mn) worth of Sukuk Murabaha on Iran Fara Bourse the other day. The securities have maturity of 4 years with a nominal rate of 17% per annum and the coupons will be paid semi-annually by Central Securities Depository of Iran.