(photo credit: Moshe Shai)
The Tel Aviv Stock Exchange plans to launch new indices next year and encourage
analyst coverage of local companies to attract foreign investment, TASE CEO
Ester Levanon said Monday at a press conference in Tel Aviv.
started to try and advance the Tel Aviv Stock Exchange as an international
center for trade and investment in hi-tech companies, by which I also consider
biotech companies, we realized that we needed to kickstart a process to increase
the exposure of the market to companies of the sector and initially Israeli
ones,” she said.
“Next year we are coming out with new indices on the
market,” Levanon said. “The last one launched this year was a biomed index. Next
year we are going to introduce a new tech index and are considering other areas
as well for equity indices such as gas, oil, communications and
She said the new index would include the 50 leading shares of
Israel’s hi-tech industry and eventually replace the Tel Tech-15
Out of 600 companies listed on the TASE this year, 144 are tech
companies and 51 are biomedical companies, forming the basis for the exchange to
become a hub for tech companies. Out of the 18 new companies joining the
exchange this year, 15 were biomed and three were hitech companies. Seven
companies left the exchange this year.
“However, the main problem we
encountered was that many of these companies were lacking exposure to analyst
coverage and exposure to international investors,” Levanon said. “We are in
advanced stages to bring an international company to Israel that will start
analyst coverage next year, including quarterly research reports of technology
and biomed companies that need and want exposure. They [won’t focus on] large
Israeli companies such as Teva Pharmaceuticals Industries or Nice Systems that
already enjoy broad international analyst coverage.”
As part of the
project, the exchange will guarantee a minimum income to the international
company that is chosen, and companies interested in analyst coverage will pay a
“reasonable” price for taking the services, she said.
will include four company reports a year in Hebrew and English for a period of
two years and will be posted on the exchange’s website, Levanon
“This will solve the problem of international investors not knowing
what Israeli companies are doing,” she said. “First we are targeting the
coverage of tech companies, and if it proves successful, we will extend it to
companies in other sectors.”
The TASE also plans to introduce options on
government bonds in the second quarter of 2011, for which it believes there is a
high demand, Levanon said.
The Tel Aviv-25 Index rose some 14.2 percent
this year, after surging by 76% in 2009, and surpassed its level on the eve of
the financial crash that began in September 2008.
The index was boosted
by the large gains of oil-and gas-exploration companies, which contributed
one-fourth to the increase. In dollar terms, the TA-25 rose 20.4% this year and
outperformed leading indices of developed foreign markets such as the Nasdaq 100
(20.2%) and the S&P 500 (12.9%).
“This year was a special year
because it was a relatively normal year, following two years of excessive highs
and lows on the exchange,” TASE chairman Saul Bronfeld said at the press
conference. “Much of the normalization of the market can be attributed to the
continued growth of the local economy in 2010, which was relatively good
compared with most of the rest of the world.”