Farabourse is an Iranian organization which has been founded in September, 2009 in order to broaden the presence of economic corporates and creating various negotiable securities in capital market, facilitate and acceleration of acceptance process, and also increasing liquidity, by less strict criteria of acceptance.
In order to implement article 99.b of the Fifth Development Plan, all affairs related to public companies such as submit, transfers, stock trading and etc. should be done through capital market. For this purpose, Consensus Trading Market like OTC was established in June, 2011. It aims to ease the trading of companies which have not been accepted in any market of Tehran Stock Exchange due to some limitations about number of stockholders, number of free-floating shares, company’s registered capital, profitability status, equity to total assets ratio and etc. and therefore CTM is open to submit firms with mentioned criteria with easier conditions compared to TSE markets.
In past, regulations about firm’s acceptance hadn’t considered any framework for companies which couldn’t hold acceptance conditions due to some problems. These problems could lead to loss, lack of informing accurately and in the right time, reduction in companies transparency and trading volume. As a result, their symbol was halted by market supervisor. halting stock’s symbol and reduction in liquidity resulted in stockholder’s loss because there was no possibility to sell the stock and their capital was blocked. Moreover, the presence of these companies and at the same time the impossibility of their stock’s trading led to reduction in indicators and indices accuracy. As a result, this kind of firms were transferred to CTM as well.
This market with having three easier criteria comparing to TSE which are: being a public company, submitted in Securities and Exchange Organization and select their auditor from TSE trustful auditors plays a crucial role in order to attract hundreds of firms and maintaining market’s liquidity.
Most of the firms that want to be submitted in this market face two major problems: lack of transparency and stockholder’s data.
According to instructions for information disclosure of Securities Market Act passed by parliament of Islamic Republic of Iran, all of public corporates have to provide their audited annual and midterm performance report in a transparent way and in the determined period so as these fresh firms don’t have enough knowledge about this kind of procedures, they will encounter some problems in the beginning point to enter CTM.
How to trade in CTM?
This market is open during 9:00 to 12:30 AM local time and trading is done by using continuous auction method in which two brokers trade through matching prices. Although stock price fluctuations don’t have any limitation, the market supervisor should confirm the deal. Online traders aren’t allowed to place any order.
In the table below, listed companies in CTM has been shown:
|Company name||symbol||Market value|
|Pars Arian Inv.||PAIP1||17,800.56B|
|Other People en||BE3P1||573.72B|
|Behesht Pars Co||BHEP1||522.71B|
|Tehran Chemie Phar||THSP1||4,457.08B|
|Ahwaz Rolling Co||FAHP1||2,451.67B|
|Ahwaz Rolling Co-R||FAHX1||15.06B|
|Ehya Sepahan Co||VHYP1||2,095.98B|
|Iran Sana Co||SNAP1||7,811.52B|
Consensus Trading Market