By Regan E. Doherty, Reuters
Robust appetite for Qatari paper has led a wide spectrum of the country's companies to tap debt markets recently, with a slew of further issuances expected in coming months, bankers said on Thursday.
The Gulf state has seen a flurry of new issues in recent months as companies seized strong international demand for Qatari debt, with many issues substantially oversubscribed.
Qatar Telecommunications Co launched a $1.5 billion bond
sale in October which drew subscriptions exceeding $15
billion. The demand led the company to tap a further
$1.25 billion dual-tranche bond days later. Qatar National
Bank's five year, $1.5 billion offering was nearly
four times oversubscribed earlier this
week.
Qatar Islamic Bank's $750 million sukuk was "a blowout
success," said a Doha-based investment banker and lead
arranger on the deal.
Petrochemicals and steel producer Industries Qatar is currently seeking a credit rating, which could likely follow with a bond issue. Doha Bank has also said it will launch a $500 million bond in January.
"Everyone wants a piece of Qatar, and the easiest way to get that is through commercial paper," said one Doha-based investment banker.
"I think there will be an avalanche of further issuances, both conventional and Islamic, early next year. The pipeline is quite heavy. There is certainly more interest from the clients, and the Islamic liquidity is out there."
The Gulf Arab region has seen a flood of new issues in recent weeks as issuers seize opportunities amid improving market conditions and strong international demand for high-yielding paper.
Corporate bond markets in the region are expected to recuperate in coming months following Dubai's recent sovereign bond issue, the first since its debt woes effectively shut regional markets, executives have said.
"The hugely successful QIB sukuk earlier this year, which had an order book approaching $6 billion, showed that there is demand from Islamic investors which is largely untapped due to the lack of supply of sukuk. Going forward there is a sizeable pipeline of Qatari corporates and financial institutions looking to tap the markets," said QInvest Chief Executive Officer Shahzad Shahbaz.
Qatar's Finance Minister said earlier this month that the country's economy will grow a staggering 21 percent next year, up from current levels of 16 percent. Qatar is the world's largest exporter of liquefied natural gas.
"The time is rather favorable for potential issuers, as interest rates are historically low and, because of excess liquidity in the markets, issuers can potentially do very well in terms of issuing their papers at rather tight prices," said Tahir Pirzada, head of investments and capital markets, treasury, at Qatar's Al Khaliji Commercial Bank. (Reporting by Regan E. Doherty; Editing by Jon Loades-Carter)