Kuwait's stock market has underperformed other Gulf bourses since peaking in mid-2013
Kuwait's Kout Food Group on Tuesday joined a growing list of companies seeking to delist from the country's stock exchange because of disappointing share price performances and limited liquidity.
The company's board said it would ask shareholders to vote on the matter, just a day after Bahrain's Gulf Finance House said it was considering leaving the Kuwaiti bourse.
In the last few months several other firms such as United Industries, Pearl of Kuwait Real Estate and Al Qurain Holding have either delisted or announced plans to do so. There are now 203 listed companies.
Kuwait has underperformed other Gulf stock markets since peaking in mid-2013, partly because it was slow to implement large infrastructure development projects which investors see as one of the main economic growth drivers in the region. Domestic political tensions and red tape have delayed the projects.
Kuwait's index fell 24 percent between the end of May 2013 and Monday's close. In the same period, Dubai gained 60 percent and Saudi Arabia rose 22 percent.
A decision by index compiler MSCI to upgrade the United Arab Emirates and Qatar to emerging market status, announced in June 2013, turned them into regional favourites while siphoning liquidity out of other markets such as Kuwait, which remains classified as a frontier one. Funds have also been flowing to Saudi Arabia's bourse ahead of its opening to direct foreign investment in the next few months.
The government said in December that it was working to improve conditions in the stock market, but it has yet to announce any major regulatory reforms.
Last month, a senior government official told Reuters that the Kuwait Stock Exchange hoped soon to carry out a long-delayed initial public offer of its own stock, and might offer up to 44 percent of its shares to a company that had experience in operating bourses.
Early this month parliament passed amendments to the capital markets law that helped to clear the way for an IPO by the exchange, and also aimed to give the regulator more authority to crack down on illicit share trading, according to officials.