Charlemagne and Turquoise push into Iran as EU lifts sanctions

Kashan Bazaar IranCharlemagne Capital and Turquoise Partners have launched a fund to invest in Iran as European Union sanctions ended this weekend. The two firms will jointly manage the Turquoise Variable Capital Investment fund, which will invest exclusively in Iranian securities and is aimed at institutional investors in the UK and Europe. Charlemagne and Turquoise expect Iran to see growth rates of between 6-8% annually “for the foreseeable future”, a spokesperson said. Dominic Bokor-Ingram, portfolio manager at Charlemagne Capital, which is a London-based emerging market asset management group, said Iran represents “one of the best emerging market investment opportunities of recent times”. Certain issues of underdevelopment found in emerging markets – such as sub-standard stock markets – do not apply to Iran, he said. “It’s a developed country with a highly educated population, a very diverse economy and a fully-functioning, highly advanced stock market and regulatory system. “We’ve never seen remotely comparable conditions in a new emerging market before.” At present, the Tehran Stock Exchange has a market cap of just over €103 billion and trades the equivalent of around €85 million on average daily, on 5.35x earnings. It offers a dividend yield of around 15%. Iran’s population is about 81 million, which means opportunities in consumer sectors are of “great interest”. For instance, a million cars are sold every year in the country, despite limited availability. “In particular, the country’s banking and telecommunications sectors are ones to watch,” Bokor-Ingram added. The fund’s investment team is led by Turquoise Partners’ Shervin Shahriari, an investor in Iran since 2002, and Stefan Bottcher and Bokor-Ingram of Charlemagne Capital. On January 16, the EU terminated all economic sanctions on Iran, including a ban on the purchase of Iranian crude oil, and restrictions on Iranian trade, shipping and insurance. Others welcomed the news on the basis it could breathe new life into the wider emerging markets sphere. ©2016 funds europe

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