Rajiv Jain, the billionaire founder and chairman of Florida-based $160.4 billion investment powerhouse GQG Partners, is bullish on opportunities in the UAE and Saudi Arabia.  

Having struck investment deals with big UAE names such as IHC, Aldar and ADNOC Gas, he is scouting for more deals in the Emirates and Saudi, because of the growth opportunities and developing capital markets in both countries.

“The vast majority of investors, in my opinion, are not paying enough attention to what is happening in the GCC in terms of opportunities here. We have almost $3 billion invested in UAE,” Jain told Zawya.

“In Abu Dhabi we have invested quite a bit of money. Alpha Dhabi, Aldar and IHC are some of the biggest investments. They are very good businesses, and the outlook is quite attractive and still selling at reasonable valuations. New listings are opening up new opportunities here, and it will expand over time,” he said.

GQG has exposure to banks, insurers and energy companies in Saudi Arabia. “We have invested in Bupa the health insurance company and have a small position in Aramco. We also like Al Rajhi Bank,” he said.

Globally, Australia’s ASX-listed GQG Partners is overweight towards power generation and utilities at this time. Jain is also known as one of the biggest backers of Adani Group Companies and invested around $2 billion in the conglomerate at the heights of the Hindenburg allegations, maintaining that the fundamentals of the Adani Group companies remained sound. 

Following Jain’s investment thesis of identifying high-quality stocks, GQG Partners set up a new hub in the Abu Dhabi Global Market last year and invested $500 million in Alpha Dhabi, which has a market cap of around $112 billion. “We look at where the earnings growth has been the most. Alpha Dhabi as a stock hasn’t done well in the last two years. But the earnings have done well. We like that. Ultimately earnings will drive stock prices,” he said.

Always maintaining a bullish emerging market view with a focus on Brazil and India, Jain was the chief investment officer at Zurich-based Vontobel Asset Management prior to starting GQG in 2016.

GQG’s Emerging Markets Equity strategy has $40.3 billion in funds.

The asset manager is keen on India’s infrastructure growth and likes Brazilian oil giant Petrobras.

GQG’s net inflows for the year ended December 31, 2024, were at $20.3 billion, of which fourth quarter net flows were $2.8 billion.

GQG has also invested in Meta, Novo Nordisk, Philip Morris International and The Coca Cola Company, through its Global Equity fund. 

Big ticket investors for UAE and Saudi

Among the emerging markets, Jain has many reasons to believe that UAE and Saudi Arabia have an accelerated chance of getting big ticket investors. He reiterated that both countries have favourable policies to ensure that minority shareholders can make money. “Both countries have ample liquidity, their capital markets are improving, currencies are stable and are driven by a keen desire to attract capital,” he said.

As far as equity capital markets are concerned, Jain rates the GCC above the rest of the world.

“The IPO markets here and in India are very active. There are no IPOs in Europe now a days. The bevy of IPOs in the UAE and Saudi show the health of the capital markets,” he said.

He added that the UAE’s market cap reaching a trillion dollars should be seen in comparison with the $2-$2.5 trillion markets that large European markets took a century to reach.

“We are looking for more opportunities to invest. If you take a 5+ year view I think the returns will be very attractive. Growth outlook has been good, earnings has been strong. More than GDP, we look at corporate earnings outlook. There are many fairly well managed companies that we come across in the region, across many sectors,” Jain said.

Real estate need not be cyclical

Residential real estate in the UAE has seen robust capital appreciation in the last eight quarters and has been continuously attracting global investors. Will the trend continue?

“Prices are going up in the UAE for a good reason. Supply is a little bit tight. Developers are releasing properties in a much more methodical way. Also, there are only a few players in the market and the demand is far stronger,” Jain said.

Real estate, according to Jain, doesn’t have to be a cyclical sector. “The problem starts when the real estate companies are too leveraged and there is too much supply,” he added.

The fund manager attributes the current trend of investment overload in the sector to safe haven buying. “What is happening in the UAE is safe-haven buying. The only other places I have seen it in are Singapore and Switzerland. It’s a very stabilizing factor,” he said.

Not keen on China, Western Europe

GQG has been underweight towards China in its emerging market strategy and its Global Equity Fund has no exposure to Chinese equity. “At the company level we are more invested in the GCC than in China.”

“In the US, we like power utilities, but we have to look at the valuations. Power generation is tight; it is going to get tighter. Supply is not keeping up with demand because of data centers,” he said.

Jain is not upbeat about Western Europe.

“If you look at Western Europe, their policies are aggressive. The cost of doing business there is going up and they are not conducive towards attracting investments,” he said citing the example of Germany, where the cost of power is prohibitive to business.

“Those countries that are changing policies more favourably for businesses will do better. I tend to see that more in some emerging markets, like India, the UAE, Saudi Arabia, and Brazil,” he added. 

(Writing by Seban Scaria seban.scaria@lseg.com; editing by Daniel Luiz )