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By Asa Fitch in Dubai and Benoit Faucon in London 

Small and midsize companies are rethinking or delaying entry to Iran following the election of Donald Trump, a break from their bigger counterparts which have struck recent deals despite concerns of fresh sanctions.

Anubhav Singh, the head of global sales and marketing at South African telecommunications-equipment maker Afripipes, said his company was halting its postdeal exploration of the Iranian market as a result of Mr. Trump's election.

"We're waiting to see what Trump's policies are with respect to Iran and then take it from there," he said.

Mr. Trump hasn't commented substantively on his plans for the Obama administration's landmark nuclear agreement with Iran -- which resulted in Tehran scaling back its nuclear capabilities in return for the lifting of most international sanctions. But he was sharply critical of it during his campaign. During his final debate with Democratic opponent Hillary Clinton, Mr. Trump called it "the stupidest deal of all time."

Gen. Michael Flynn, who was appointed national security adviser in the Trump team, has previously called the nuclear agreement a "bad deal" and warned it could lead to the "elimination of Israel."

Such rhetoric hasn't stopped corporate giants such as Boeing Co., Airbus SE, Royal Dutch Shell PLC, Total SA and Vodafone Group PLC from testing the waters in Iran since the country's nuclear deal with six world powers took effect in January last year. None of those companies has suggested a shift in strategy due to Mr. Trump's election.

Smaller companies, because of their size, can't as easily absorb losses from ventures that have to be scrapped because of sanctions. In the past, U.S. sanctions have had a chilling effect on companies dealing with Iran because some of them apply on any company with American connections.

Before the nuclear agreement was struck in 2015, several European banks were heavily fined for breaching Washington's restrictions on trading with Tehran. Meanwhile, oil companies pulled out of Iran to avoid risking fines.

Bakhshish Singh, the general manager of marketing at Ambrane, an Indian consumer-technology vendor, said his company recently reached a distribution agreement with a partner in Dubai to sell goods in the Iranian market. But the possibility that Iran may face new sanctions under Mr. Trump, boosting the price of shipping his goods there, has given him pause.

While Ambrane is sticking to its deal for now, Mr. Singh is waiting for more clarity on how Mr. Trump plans to approach the country.

Even some straightforward export deals have been affected. Nigel Kushner, the chief executive of London-based law firm W Legal, said a client canceled plans to export $1 million worth of U.K. technologies to Iran in the wake of Mr. Trump's criticism of the nuclear deal. Mr. Kushner said his client had referred to the president-elect to explain its decision to pull out of the deal.

The outlook isn't all gloomy for smaller firms. Some are hopeful that Mr. Trump won't tear the nuclear deal to pieces. Washington can't unilaterally undo the deal, which was reached by multiple world powers in 2015 and is being implemented by the United Nations and negotiating countries. But the U.S. could undermine it by enacting new sanctions that would force companies to renounce dealing with Iran if they want to continue trading with the U.S. or deal with its banking system.

Iranian President Hassan Rouhani said Tuesday that the nuclear deal wasn't a bilateral agreement, and hence he thought it unlikely Mr. Trump would take steps to undo it. "It's a done deal," he said, and new negotiations "don't make any sense."

Shayan Shadfar, the managing director of IranianOffice, a company that helps foreign firms set up in Iran, said Mr. Trump's business background will make him more of a deal maker than deal breaker. The day after the election, he said, a large American company got in touch about entering Iran. "I believe this is a sign," he said.

U.S. financial restrictions on trading with Iran are likely to remain in place under a Trump administration -- an impediment that will affect those who do business through U.S. banks and brokerages.

The Trump transition team didn't respond to a request for comment.

Khaled Abdel Majeed, the founder and managing partner of the London-based MENA Capital, hoped to be able to invest in the Iranian stock market in the wake of the deal. But his broker Merrill Lynch doesn't offer such trades.

"It doesn't look like it'll happen anytime soon," Mr. Majeed said.

A Merrill Lynch spokesman confirmed that the company doesn't allow trading in Iranian shares.

Many larger companies have said they don't anticipate a change in plans in Iran as a result of Mr. Trump's election, and a wave of deal-making in the country has ensued.

In December, Shell signed an agreement with Iran's state oil company to look at future projects, though the amounts involved have yet to be discussed. France's Total and China National Petroleum Corp. reached a preliminary gas-development deal in early November, worth $4.8 billion.

Outside the energy sector, U.S. aerospace giant Boeing and its European competitor Airbus reached agreements late last year for dozens of jets, with deals respectively worth $16.6 billion and $18 billion at list prices.

There are challenges beyond the threat of sanctions that could slow the pace of investment in Iran. John Podaras, a partner at the consultancy Hotel Development Resources in Dubai, said there had been a noticeable slowdown in investment in the hospitality sector in the second half of last year that probably has more to do with practical issues -- including administrative delays and uncertainty around landownership rules -- than concerns of a Trump presidency.

Investor sentiment toward Iran, he says, "has always been quite cautious."

Write to Asa Fitch at asa.fitch@wsj.com and Benoit Faucon at benoit.faucon@wsj.com

(END) Dow Jones Newswires

January 18, 2017 05:44 ET (10:44 GMT)

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