When Al Ramz was established in 1998, the limited liability company had a capital of merely AED 500,000. Today, the company has the capital of nearly AED 550 million, most of which were generated by retaining profit. The brokerage house, Al Ramz Capital, flagged off operations with the support of shareholders such as Abu Dhabi’s InvestAD and other prominent businessmen. As a subsidiary of the four companies owned by Al Ramz Corporation Investment & Development, Al Ramz Capital provides brokerage services, both con¬ventional and Islamic, margin trading, market making, liquidity providing, research, and e-trade.
The company began expanding its business in 2007 by buying out brokerage companies, even¬tually leading to the acquisition of the Dubai Development Corporation in October 2016: the first reverse takeover of a publicly listed company by a private one, in the U.A.E’s his¬tory. Al Ramz Corporation’s Managing Director, Mohammad Al Murtada Al Dandashi, notes that the unique takeover was “like a dream”. “After we started the company in 1998, the cy¬clicality of our business made it tough to deliver consistent results, and the need to diversify lines of business in order to sustain profitability became an urgency”, he adds. “We, therefore, decided to do two things; one, to make history by buying inactive listed company and turning it into an active one and increase its capital. Two, to expand our lines of business into asset management, corporate advisory, and other lines of investment banking.”
True to that, the corporation expanded significantly to diversify inherent risks, as well as to withstand chronic bouts of subdued trading. “Today, we have asset management, corporate advisory, market making, liquidity providing, research and of course trading services. In short, we have the full investment banking product suites which are cushioning us from any market volatility.” The company launched its investment management services division in 2016, following the resolution of a rights issue that the company launched in late October of the same year when it placed 95 million new shares on offer. The division has since played a major role in Al Ramz development, who were the best performers on the Dubai stock exchange for that week after a trade of 5,643 shares made the stock rise by 14.4% to AED 1.35.
Impressively, Al Ramz Corporation’s modus operandi of converting even the biggest challenges into opportunities clearly accounts for a large part of its immense success in the region. Al Dandashi doesn’t view recent volatility and turbulence in the market with great concern. “We have faced 1998, we have faced 2008 and other crossroads but we have overcome all these challenges thanks to our established values, great team and ingenuity,” says Al Dandashi. “We persevere and maintain to be dynamic to changes, we think outside the box; we’ve had stable management for 20 years. All of these have led to a successful track record, helping us to beat all odds and to deliver results even in tough years. We are the most bankable company in this market and in this industry since its inception. We have no doubts about our ability to deliver.”
Growth has been promising for Al Ramz, which was recently granted a license to practice short-selling activity in and by the Abu Dhabi Securities Exchange (ADX). This makes the company the second company to conduct this activity in the ADX. Short selling license from DFM is also in progress. A market leader in the U.A.E.’s financial services industry, Al Ramz was also the first brokerage house to be granted a financial consultation and analysis license by the Emirates Securities and Commodities Authority (ESCA) to trade in foreign markets, and the U.A.E.’s first brokerage house to
provide Islamic Margin Trading services. The company is licensed by the Securities and Commodities Authority (SCA) to operate in the ADX, the DFM and Nasdaq Dubai, allowing Al Ramz to comprehensively cover all of U.A.E.’s capital markets.
Yet Al Ramz’s immense success hasn’t come without its challenges. Al Dandashi stresses the importance of having a credible and professional team that a business can rely on, particularly in turbulent economic times. “The main challenge we face is human capital,” he notes. “They may have the right experience, but they may lack the right values. Our business is entirely based on trust, and you have to have a reliable and professional team to oversee delivery to customers. So that’s our biggest challenge. We have been successful in this regard and are recognized in the industry for our team.”
Saudi Arabia is quite attractive, but we shall see,” Al Dandashi muses. “It is a tough and competitive market, but I am bullish about it.” As for his advice for investors in 2018, Al Dandashi advises them against specu¬lation when deciding where to put their money. “Investors need to focus on companies that have good fundamentals instead of basing their decisions on sentiment and/or speculation,” he warns. “They should look at their investments from a medium to long term perspectives. Speculation is burning now, and many investors here are driven by speculation, which is not the right approach.”
As the occasion of Al Ramz’s 20th year in the business approaches, the company will begin the process of overhauling its image and re-branding. “We are a full-fledged investment bank, actually,” Al Dandashi explains. “We are still perceived as a brokerage company only, but we are much more- we are market leaders. We are also trying to contribute to upgrading our capital markets to gradually become more developed. We work hand in hand with the regulators and markets to discuss the obstacles and solutions and how to get where we want.” The upward swing the U.A.E.’s market has taken in recent years has been greatly facilitated by the game-changing MSCI upgrade it received on its classification of markets in 2014, which promoted fund flows from institutional investors and raised the efficiency of the markets in the U.A.E, ensuring more stability and investments.
In Al Ramz’s characteristic style, Al Dandashi is also optimistic despite the recent volatility of oil prices that have rocked the local markets. “There are always opportunities,” he says mildly. “The U.A.E. has taken major steps towards diversification and in reducing reliance on oil. The economy is resilient and sectors such as financial services, tourism and trade will continue to prosper.”