kuwait financial centre “markaz” - amazon web...

Kuwait Financial Centre “Markaz” R E S E A R C H

Qatar Stock Market Outlook, 2016

Outlook - Neutral

Expectations 2016

Current Expectations UAE

Economic Factors Neutral

Valuation Attraction Positive

Earnings Growth Potential Neutral

Market Liquidity Negative

Overall Market View Neutral

Source: Markaz Research

We were positive for Qatar in our last year assessment. However, the sudden

and persistent decline in oil prices resulted in Qatar’s stock index tanking by 15%

during 2015. The decline in index levels has made valuations attractive but our

expectations for earnings growth remains flat for the year ahead. Despite the

emerging market status, prevailing negative investor sentiments amid declining

commodity prices, especially gas, could work against Qatar in the medium term.

Low oil prices have completely shifted the balance of the global economy. Almost

all of the GCC countries have to live with the low oil prices that are considered

the new normal. This prolonged decline in prices have resulted in most

international agencies such as IMF and IIF to reduce their growth forecasts for

Qatar at 4.9% and 4.3% respectively (real GDP growth) for 2016 in view of

lower revenues from gas and allied industries and government spending cuts.

Going forward, we evaluate the attractiveness of the Qatar stock market based

on four-factor model.

Valuation: Positive

Price-to-earnings multiple for Qatar has fallen by 25% and currently stands at

11.1x. Qatar market is relatively undervalued when compared to the markets of

Saudi Arabia and Kuwait. Investor interest in the market waned post 2014 owing

to poor international conditions. Qatar also has the highest dividend yield in the

region at 5.1%. Telecom and Industrial indices were worst affected, falling by -

33.6% and -21.1% respectively.

Earnings: Neutral

We expect corporate earnings growth to be slightly negative in 2016. Earnings

are expected to slightly reduce as infrastructure spending peaks. Real estate and

commodities sector in Qatar are expected to be worst hit with their earnings

expected to decline by -10% and -15% respectively. Declining oil and gas prices

could affect the commodities sector. Real estate firms in the country witnessed a

sharp correction in the 2nd half of 2015 which could continue into 2016 as well.

Earnings from the telecom sector are also not expected to increase given the

decline in ARPUs and maturing markets. Hence, we have a neutral view on

earnings for Qatar.

January 2016

Research Highlights:

Analysis of Qatar’s stock market performance in 2015 and

providing outlook for 2016 based on four-factor model.

Markaz Research is

available on

Bloomberg - Type “MRKZ” <Go>

Thomson Research,

Reuters Knowledge

Nooz

Zawya Investor

ISI Emerging markets

Capital IQ

FactSet Research Connect

TheMarkets.com

M.R. Raghu CFA, FRM

Head of Research

+965 2224 8280

[email protected]

N. C. Karthik Ramesh

Manager - Research

+965 224 8000 Ext : 4611

[email protected]

Rakesh Khanna

Analyst +965 2224 8000 Ext: 4612

[email protected]

Kuwait Financial Centre

K.P.S.C “Markaz”

P.O. Box 23444, Safat 13095,

Kuwait

Tel: +965 2224 8000

Fax: +965 2242 5828

markaz.com

mailto:[email protected]


MARKAZ RESEARCH

Qatar Stock Market Outlook 2016 - January 2016

Kuwait Financial Centre “Markaz” 2

Economy: Neutral

Growth in Qatar is expected to be moderate (4.9% Real GDP growth for 2016)

on account of calculated spending cuts. Qatar, in its recent budget has

announced to reduce the budget spending by 7.28% to $ 55 Bn. Major

infrastructure spending has been left untouched with the spending cuts expected

to affect in the excess in state-funded organizations such as Qatar Museums,

Qatar Foundation and Al Jazeera1. The government has also announced that it is

planning to borrow from abroad as well as within the region to fund its deficit

instead of dipping into its reserves. Given the cost associated with borrowing

funds we expect Qatar government to invest them in sectors that contribute

positively to the economy. Current account balance is expected to turn negative

and IMF expects current account deficit of 3.9% during 2016. Based on the

above we have provided a neutral rating on Qatar’s economy.

Market Liquidity: Negative

Stock turnover ratio stood at 13% in 2015 as value traded for the year fell by

56% to USD 23bn from USD 41bn registered a year back. Qatar has a long way

to go to reach KSA’s turnover levels of 93%. 2014 being the year of Qatar’s

inclusion in MSCI Emerging Market Index witnessed hectic investor activity.

Consequently, the fall in value traded could be a result of foreign investment cap

for stocks being already met and no further scope for fresh investments. Global

slowdown, meltdown in the Chinese markets and the resultant negative investor

sentiments were the reason behind poor performance of the market. Given the

knock-on effect that these factor have on the global investor sentiment we do

not expect the market volumes to improve in 2016. Owing to poor investor

sentiments there were no IPOs that came out in Qatar during 2015. Hence, we

have a negative view on the liquidity of Qatar’s stock market.

In sum, we believe that only 1 out of 4 factors are positive for Qatar and hence

we take neutral stance on the Qatar market.

Qatar Index, Performance (in %), 2007-2015

Source: Reuters

1 Doha News

34%

-28%

1%

25%

1%

-5%

24%

18%

-15%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

2007 2008 2009 2010 2011 2012 2013 2014 2015

Qatar, in its recent budget has

announced to reduce the

budget spending by 7.28% to $

55 Bn.

Global slowdown, meltdown in

the Chinese markets and the

resultant negative investor

sentiments were the reason

behind poor performance of the

market.

In Qatar, Telecom and

Industrials indices lost 33.6%

and 21.1% respectively.

MARKAZ RESEARCH



What Happened in 2015?

Monthly Market Performance

Markets Jan'15 Feb'15 Mar'15 Apr'15 May'15 Jun'15 July'15 Aug'15 Sep'15 Oct'15 Nov'15 Dec'15

2015

YTD

Qatar(QE

Index) -3.1% 4.6% -5.9% 3.9% -1.0% 1.3% -3.4% -1.9% -0.9% 1.2% -13.0% 3.4% -15.1%

S&P GCC 2.8% 4.4% -6.9% 10.1% -2.3% -3.5% 0.1% -13.2% -1.1% -2.7% -2.3% -2.4% -17.4%

IPE Brent -7.6% 18.1% -11.9% 21.2% -1.8% -3.0% -17.9% 3.7% -10.7% 2.5% -10.0% -16.4% -35.0%

Source: Reuters Eikon;

Qatar index, which was majorly flat until June 2015, started declining in the

latter half of the year. GCC markets were rocked by the fall in Chinese equities

which resulted in region wide selling. Uncertainty over oil prices and political

situation in the region only helped to exacerbate the problem. Qatar market fell

sharply in November 2015; Qatar lost -13.0%.

In Qatar, Telecom and Industrials indices lost 33.6% and 21.1% respectively.

Ooredoo QSC, which is Qatar’s largest telecom operator in terms of market

capitalization, fell by 40% during 2015. Ooredoo Qatar had registered total

earnings of $207.64 Mn during the first 9 months of 2015 (doubling its net profit)

helped by improved profit margins and sale of stake in Philippines Company Wi-

Tribe. However, the Trailing twelve months (TTM) Earnings per share (EPS) fell

from QAR 7.9 last year to QAR 5.7 currently due to the performance in Q4 2014

which was badly hit on account of foreign exchange losses in Indonesia and

higher operating costs in Myanmar and Algeria2. Despite the increase in profits

over the last three quarters, Ooredoo’s performance was dismal at the stock

market owing to mobile saturation in major markets such as Kuwait and Qatar.

Ooredoo’s investment in Iraq is under threat due to geopolitical developments.

Ooredoo’s PE (TTM) ratio fell from 15.7x at the end of 2014 to 11.7x at the end

of 2015. The fall is primarily attributed to the fall in the share price (-40%).

However, the fall in PE would have been greater if not for the poor financial

performance in Q4 2014.

Transportation, Real Estate and Insurance were the only sectors to achieve

positive returns during the year gaining 4.9%, 3.9% and 1.6% respectively.

Among transportation stocks in Qatar market, Gulf Warehousing Company gave

the highest return during the year at 10.53%. The positive performance in the

stock market was driven by the steady rate of growth in its net profits in the first

nine months of 2015. GWC witnessed 31.9% increase in net profits compared to

the same period last year. The company’s sports logistics activities, Equestrian

logistics and art partnership all had a very active 3rd quarter. GWC is also

expanding rapidly at Logistics Village Qatar and at Ras Laffan Industrial facilities.

Qatar insurance was the only company in the insurance sector to end 2015 on a

positive note with 4.08% increase in share price.

2 Reuters

GCC markets were rocked by

the fall in Chinese equities

which resulted in region wide

selling.

Ooredoo’s performance was

dismal at the stock market

owing to mobile saturation in

major markets such as Kuwait

and Qatar.

Qatar insurance was the only

company in the insurance sector

to end 2015 on a positive note

with 4.08% increase in share

price.

MARKAZ RESEARCH



Qatar Index, Sector-wise, 2015

Source: Reuters

Banking and Industrial sector stocks account for almost 61% of the market

capitalization of the Qatar index.

Qatar Stock Index, Sector-wise weights, 2015

Source: Qatar Stock Exchange

Qatar National Bank (QNB), which is the largest lender in the GCC region and is

the largest company listed on the Qatar stock exchange, achieved a 6.1 percent

increase in third-quarter net profit. The bank made a net profit of $854 million in

the three months to Sept. 30, up from $791 million a year before. Lending

growth in Qatar is a significant driver of banking profits, propelled by large

government spending on infrastructure ahead of the state's hosting of the FIFA

World Cup in 2022. Bank credit growth in Qatar accelerated to an annual 15.0

percent in August, the fastest rate since February 20143. Qatar Islamic bank

which is the 3rd largest bank in Qatar in terms of market capitalization generated

a nine-month net profit of $38 Mn, up from $30Mn a year earlier (an increase of

3 Qatar Central Bank

-15.1%

4.9% 3.9% 1.9%

-12.4%

-13.1% -21.1%

-33.6%

-40%

-35%

-30%

-25%

-20%

-15%

-10%

-5%

0%

5%

10%

Qata

r Index

Tra

nsp

orta

tion

Real E

state

Insu

rance

BFSI

Consu

mer G

oods

Industria

ls

Tele

com

39%

22%

17%

6% 6%

5% 4% Banks & Financial Services

Industrials

Real Estate

Transportation

Insurance

Consumer Goods and Services

Telecom

Bank credit growth in Qatar

accelerated to an annual 15.0

percent in August, the fastest

rate since February 2014.

Industries Qatar, one of the

bell-weather stock in the Qatar

stock exchange, fell by 33.87%

in 2015.

MARKAZ RESEARCH



26%). The bank's net fee and commission income over the same period was $93

Mn, 19 percent higher than a year ago. Qatar Islamic bank has gained 4.4%

during 2015.

Industries Qatar, one of the bell-weather stocks in the Qatar stock exchange, fell

by 33.87% in 2015. Industries Qatar group recorded strong financial results

across all segments during 2015 amidst the current economic environment as

the sales volumes grew in excess of 12% following the return to normal

operations of most of the group’s productions facilities which were on extensive

maintenance during the first half of 2014. Selling prices in the petrochemical and

steel segments were impacted significantly due to the prevailing low oil prices.

Net profit for the 9 month period was $ 1.02 billion, down by $ 243 Mn or 18.8%

against the same period in 2014.

Qatar Electricity and Water was the only stock in the industrial sector to end the

year on a positive note gaining 15.41%. The utility firm made a nine-month net

profit of $307 Mn, down from $315 Mn in the same period of last year.

Large Cap4

Top Gainers-Large Cap

Company Sector M Cap

(USD mn) Last

Close

YTD returns (in %)

P/E P/B Div

Yield Beta ADTV5

Qatar Electricity and Water Co QSC

Utilities 6,536 216.4 15% 15.9 3.4 0.85 3.5 High

Al Meera Consumer Goods Co QSC

Consumer Non-

Cyclicals 1,208 220 10% 21.7 3.3 0.92 4.1 High

Ezdan Holding Group QSC Financials 11,581 15.9 7% 26.9 1.4 1.48 2.5 High

Qatar Islamic Bank SAQ Financials 6,923 106.7 4% 13.4 1.7 1.13 4.0 High

Qatar Insurance Co SAQ Financials 4,157 82 4% 16.0 2.7 0.79 2.7 High

Source: Reuters; ADTV – Average Daily Trading Volume

Qatar Islamic Bank (QIB) made a nine-month net profit of 1.41 billion riyals, up

from 1.13 billion riyals a year earlier. Nine-month income from financing and

investing activities was 2.8 billion riyals, up 24 percent year-on-year. Qatar

Insurance reported a 20 percent fall in net profit for the third quarter. Qatar

Insurance recorded a net profit in the first nine months of 2015 of 693 million

riyals, down from 780 million riyals (-11%) in the same period of 2014. Ezdan

holdings generated a profit of 1.2 billion riyals (20% growth) in the first nine

months of 2015, up from 1 billion riyals in the corresponding period of last year.

Top Five Decliners-Large Cap

4 Stocks listed in Qatar with market capitalization value of greater than USD 1,000mn have been considered as large caps for our analysis

5 ADTV Rating: High- Greater than USD 50,031; Low- Less than USD 31,270 & Average - Rest

MARKAZ RESEARCH




(USD mn) Last

Close

YTD returns (in %)

P/E P/B Div

Yield Beta ADTV

Gulf International Services QSC

Industrials 2,628 51.5 -47.0 6.6 2.4 10.7 1.30 High

Ooredoo QSC Telecommunications Services

6,597 75 -39.5 13.2 1.1 5.3 1.02 High

Mesaieed Petrochemical Holding Co QSC

Basic Materials 6,692 19.4 -34.2 20.2 1.8 5.7 0.00 High

Industries Qatar QSC

Industrials 18,457 111.1 -33.9 12.3 2.0 6.3 1.00 High

Qatar Fuel QSC Energy 3,421 147.5 -27.8 10.7 1.9 6.1 0.60 High

Source: Reuters

Ooredoo QSC, which is Qatar’s largest telecom operator in terms of market

capitalization, fell by 39.47% during 2015. Mesaieed Petrochemical Holding

Company (MPHC) generated a net profit of QR786.19 million for the first nine

months of 2015, down 34.29% year-on-year. The year-on-year decrease in

earnings was a result of a number of maintenance shutdowns combined with

slowdown in global oil prices. Masraf Al Arayan’s net profit for the nine months to

Sept. 30 was 1.51 billion riyals, compared with 1.43 billion riyals in the same

period a year ago. Financing activities for the nine-month period reached 59.9

billion riyals, up by 9.2 percent from the same period in 2014.

Mid Cap6

Top Gainers7-Mid cap


(USD mn) Last

Close

YTD returns (in %)

P/E P/B Div

Yield Beta ADTV

Gulf Warehousing Co QSC Industrials 929 56.9 11% 17.1 3.2 0.87 2.4 High Medicare Group QSC Healthcare 922 119.3 2% 17.1 3.7 1.36 4.2 High

Zad Holding Co SAQ Consumer

Non-Cyclicals 502 84.8 1% 9.8 1.4 0.42 4.7 Average

Source: Reuters

There were three companies that generated positive return in this segment. Gulf

Warehousing Company gave the highest return during the year at 11%. The

positive performance in the stock market was driven by the steady rate of

growth in its net profits in the first nine months of 2015. Net profit for Medicare

Group in the first nine months of the year rose 12.5% to about QR 128.8 million

compared to QR 114.5 million in the corresponding period last year. The increase

in profits was driven by the 17% increase in revenues during the 1st 9 months of

2015. Total revenues of the Zad Holdings in the first nine months increased by

23% to QR 799.2 million, including QR 90.5 million compensation from the

government to support bread price. Direct cost rose 21.8% to QR 639 million

and accordingly the overall operating profit rose 21.8% to QR 160.2 million. Net

profit for Zad Holding Company in the first nine months fell to QR 126.76 million

compared to QR 147 million in the corresponding period last year.

6 Stocks listed in Qatar with market capitalization value of lesser than USD 1,000mn but greater than USD 500mn have been considered as mid-caps for our analysis 7 There are only four stocks in the Qatar stock exchange that could be classified as Mi-cap stocks

Ooredoo QSC, which is Qatar’s

largest telecom operator in

terms of market capitalization,

fell by 39.47% during 2015.

Masraf Al Arayan’s net profit for

the nine months to Sept. 30

was 1.51 billion riyals,

compared with 1.43 billion riyals

in the same period a year ago.

MARKAZ RESEARCH



Mid Cap8

Top decliners -Mid cap


(USD mn) Last

Close

YTD returns (in %)

P/E P/B Div

Yield Beta ADTV

Qatar Industrial Manufacturing Co QSC

Industrials 520 39.85 -8% 13.0 1.3 0.49 7.5 High

Source: Reuters

Gross profit for Qatar Industrial Manufacturing Company from its sales in the first

nine months of the year rose 9.3% to QR 45.9 million. Net profit for Qatar

Industrial Manufacturing Company (QIMC) in 9 months stood at QR 135 million

compared to QR 141 million in the corresponding period last year. The stock

declined by 8% in 2015

Small Cap9

Top Gainers-Small Cap

Companies Sector M. Cap

(USD mn) Last

Close 2015 P/E P/B Beta

Div. Yield

ADTV

Qatari German Company for Medical Devices QSC

Healthcare 44 13.72 35% nm 1.0 0.67 0.0 High

Source: Reuters

Qatari German Company for medical devices was the only company in the small

cap segment to achieve positive share price gain in 2015. Qatari German

Company for Medical Devices net loss in the first nine months to stand at QR 9.4

million compared to QR 9.9 million in the corresponding period last year. Gross

operational revenues of the company together with other income in the first nine

months declined 52% to about QR 357 thousand. Total expenses decreased by

22.1% to QR 6.7 million. Stock of Qatari Company gained by 35% in 2015.

Top Five Decliners-Small Cap


(USD mn) Last

Close

YTD returns (in %)

P/E P/B Div

Yield Beta ADTV

Dlala Brokerage and Investment Holding Co QSC

Financials 144 18.49 -45% nm 1.9 1.13 0.0 High

Al Khaleej Takaful Group QSC Financials 214 30.5 -31% 15.1 1.3 0.79 4.3 High Alijarah Holding Co QSC Industrials 192 14.1 -30% nm 0.6 0.79 6.0 High Doha Insurance Co QSC Financials 288 21 -28% 15.5 1.0 0.71 4.8 Low Salam International Investment QSC


Source: Reuters

Net loss of Dlala Brokerage and Investment Holding Company in the first nine

months of the year stood at QR 24.1 million compared to net profit of QR 62.29

million in the corresponding period last year. Net operating revenue of Dlala

Brokerage and Investment Holding Company in 9 months fell 59.9% to QR 33.5

million, of which QR 23.9 million net brokerage revenues, which fell by more

8 Stocks listed in Qatar with market capitalization value of lesser than USD 1,000mn but greater than USD 500mn have been considered as mid-caps for our analysis 9 Stocks listed in Qatar with market capitalization value of lesser than USD 500mn have been considered as small caps for our analysis

Gross profit for Qatar Industrial

Manufacturing Company from

its sales in the first nine months

of the year rose 9.3% to QR

45.9 million.

Qatari German company for

medical devices was the only

company in the small cap

segment to achieve positive

share price gain in 2015.

Al Khaleej Takaful Group net

profit in the nine months stood

at QR 32.2 million, a decline of

41.4% compared to net profit of

QR 55.1 million in the

corresponding period last year.

MARKAZ RESEARCH



than half owing to lower trades that took place in Qatar stock exchange.

Expenses of all kinds, including depreciation, marginally increased to QR 21.4

million. Alijarah Holding posted a net loss of QR 42.4 million in Q3 2015

compared to net profit amounting to QR 36.5 million for the same period of the

previous year. Al Khaleej Takaful Group net profit in the nine months stood at QR

32.2 million, a decline of 41.4% compared to net profit of QR 55.1 million in the

corresponding period last year. The company's net income in the first nine

months of the year fell 41.6% to QR 63.5 million, of which QR 25.9 million came

from Takaful insurance agency income and QR 28.5 million from investment

income and the rest from others, noting that most of the decline was result of

lower investment income. Doha Insurance was the latest, reporting a net profit

of QR42 million in the first three quarters of 2015. This is down from QR57

million during the same period of last year. Salam International Investment’s net

profit was down 1.9% year-on-year to QR65.9 million, from QR67.2 million in the

same period of last year.

MARKAZ RESEARCH



What to expect in 2016?

We base our analysis on a set of four factors, which we believe will influence and

impact market performance. We have assigned weights to each of these factors

based on our assumption about the degree of influence it would have on the

stock market performance as a whole in 2016. An explanatory note for all the

five factors can be found in Appendix 1.

Five-Force Framework


1. Earnings Growth Potential

The total corporate earnings of Qatar is expected to increase by 4.7% during

2015. Qatar had the highest earnings growth out of all the GCC countries during

the first three quarters of 2015. Revenues from the banking and real estate

sector were the ones responsible for the strong performance. Earnings from the

real estate sector grew at a rate of 129.4% (YoY) while the earnings from the

banks grew at 7% (YoY) during the same period. Real estate sector’s earnings

were boosted by the one-off gain that Barwa real estate was able to achieve.

Banking sector has a larger impact on the total earnings for Qatar accounting for

44% of the earnings.

GCC Stock Market

Assessment

Valuation Attraction

25%

Market Liquidity

10%

Economic Factors

25%

Earnings Growth Potential

40%

Qatar had the highest earnings

growth out of all the GCC

countries during the first three

quarters of 2015. Revenues

from the banking and real

estate sector were the ones

responsible for the strong

performance.

Earnings from the real estate

sector grew at a rate of 129.4%

(YoY) while the earnings from

the banks grew at 7% (YoY)

during the same period.

MARKAZ RESEARCH



Earnings Trend – Qatar (USD mn)

Source: Thomson Reuters Eikon, Markaz Research

We expect banks to maintain their momentum as the economy continues with its

infrastructure expansion and continued credit growth expectations. Real Estate is

another sector that has witnessed tremendous increase in profits over the last

year. Barwa Real estate’s profit rose by 4X till September 2015 which has helped

in boosting the sector’s revenue as a whole. But owing to the real estate sector’s

reliance on oil as an important growth driver and a higher base effect, we expect

the real estate sector to perform negatively in 2016.

Qatar, with a population of 2.16 Mn and high mobile penetration of 100%10,

offers an intense competitive environment for telecom operators. Ooredoo and

Vodafone Qatar are the only two companies to offer mobile services in the

country. Both of these operators have achieved saturating point and currently

experiencing a significant drop in ARPUs (Average Revenue per User).

At the start of 2016, we expect overall earnings growth to be marginally negative

at -0.6%. While Qatar has been diversifying its source of revenues, the payoff

from them is not expected to be immediate. Banks and construction related

sectors alone are expected to post positive earnings in 2016, the former owing to

the strong local consumption demand and credit growth, the latter owing to the

huge infrastructure spending that the Qatar government has been undertaking in

its preparation for the Football World Cup in 2022.On a overall level we expect

the earnings growth to be subdued in 2016 and hence hold a neutral view.

2. Valuation Attraction

On a standalone P/E basis, Qatar, with a ratio of 11.1x of the earnings, appears

to trade at lower valuation level compared to peers such as KSA & Kuwait. On

P/B basis Qatar market is the most expensive among all GCC nations at 1.6x.

Dividend yield for Qatar stands at 5.1% which is the highest among GCC along

with Bahrain. On an overall basis, we adopt a positive view on Qatar.

10 Telegeography

2,843 3,840

5,529

7,460

9,094

8,133

10,300 10,178

11,261

12,365 12,951 12,870

52%

35%

44%

35% 22%

-11%

27%

-1%

11% 10% 5%

-1%

-50%

0%

50%

100%

150%

200%

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015e 2016f

Earnings, USD mn (LHS) Earnings Growth (RHS)

Barwa Real estate’s profit rose

by 4X till September 2015 which

has helped in boosting the

sector’s revenue as a whole.

On a standalone P/E basis,

Qatar, with a ratio of 11.1x of

the earnings, appears to trade

at lower valuation level

compared to peers such as KSA

& Kuwait.

MARKAZ RESEARCH



Valuation Parameters Summary

P/E (TTM) KSA Kuwait UAE Qatar Oman Bahrain

2010 21.3 16.8 11.0 20.3 14.0 11.4

2011 18.3 15.0 9.4 15.9 14.7 10.7

2012 18.2 18.7 9.3 16.6 13.0 12.4

2013 17.1 18.3 15.0 15.2 11.3 10.6

2014 12.8 15.4 12.0 15.4 10.3 11.0

2015 13.0 14.4 10.4 11.1 9.9 9.1

P/B KSA Kuwait UAE Qatar Oman Bahrain

2010 3.0 1.5 0.9 3.0 2.2 1.3

2011 2.8 1.5 na 2.5 2.2 1.2

2012 2.6 1.5 0.9 2.3 1.9 1.2

2013 2.4 1.4 1.3 2.1 1.6 1.1

2014 1.8 1.3 1.5 2.1 1.4 1.1

2015 1.5 1.1 1.3 1.6 1.2 0.9

Dividend Yld (TTM)

KSA Kuwait UAE Qatar Oman Bahrain

2010 2.1 4.5 3.1 2.3 3.8 3.7

2011 2.5 3.2 4.8 2.7 3.7 3.8

2012 2.6 2.8 3.9 3.2 4.3 3.0

2013 3.0 3.5 2.3 3.7 4.3 4.2

2014 3.7 3.7 2.9 3.7 5.0 8.1

2015 4.2 4.3 4.2 5.1 4.9 5.1

Qualitative Assessment

Neutral Neutral Positive Positive Positive Positive

Source: Zawya, Markaz research; Data as of Dec 13, 2015

3. Economic Parameters

Based on our analysis, we have maintained a neutral view on Qatar due to tepid

growth expectations.

i. Real GDP Growth Forecast

Real GDP growth in Qatar is expected to be only slightly better in 2016, on the

back of increased infrastructure spending that the government has planned as

part of its bid for the 2022 Football World Cup. Qatar has earmarked a total of

$229 Bn to be spent on the projects, which includes construction of a new city, a

rail network and a mega reservoirs project. While the prices of oil and gas have

come down rapidly in the past year, the government of Qatar has committed to

keep up with the spending on the economy. Qatar is also cutting down on its

budget spending to reflect the huge drop in oil prices. Qatar has forecast a

budget deficit of more than $12 billion in 2016, citing a sharp drop in oil and gas

prices. The revenues of the country are expected to fall to $42.85Bn in 2016

from $61 Bn that it had earned in 2015. Meanwhile the expenditure is expected

to be $54 Bn (7% less than last year’s expenses). The non-hydrocarbon sector is

the highest among the GCC countries. The non-hydrocarbon will continue to

expand, but the rate of growth will subdue as the infra spending peaks,

construction activity levels off and the inflow of migrant workers decline.

Financial, real estate, transport and communication, and business services are all

expected to benefit from the property development and infrastructure projects.

Qatar has earmarked a total of

$229 Bn to be spent on the

projects, which includes

construction of a new city, a rail

network and a mega reservoirs

project.

Qatar has forecast a budget

deficit of more than $12 billion

in 2016, citing a sharp drop in

oil and gas prices.

MARKAZ RESEARCH



Trade and hospitality are also expected to grow robustly owing to conference

activities and to growth in tourist arrivals, particularly from the region. Moderation

of population growth is expected to slow service sector expansion in 201611.

Real GDP growth rates (%)

Real GDP Growth (in %) KSA Kuwait UAE Qatar Oman Bahrain

Real GDP Growth (2008-2012 Avg) 6.1 2.3 2.3 13.5 5.8 3.8

Real GDP Growth (2013) 2.7 0.8 4.3 4.6 4.7 5.3

Real GDP Growth (2014) 3.5 0.1 4.6 4.0 2.9 4.5

Real GDP Growth (2015 e) 3.4 1.2 3.0 4.7 4.4 3.4

Real GDP Growth (2016 f) 2.2 2.5 3.1 4.9 2.8 3.2

Source: IMF

Real Oil GDP Growth Rates (in %)

Real Oil Growth KSA Kuwait UAE Qatar Oman Bahrain

Real GDP Growth (2008-2012 Avg) 2.8 3.2 0.8 12.7 4.9 -1.0

Real GDP Growth (2013) -1.6 -0.7 4.8 0.2 2.4 15.3

Real GDP Growth (2014) 0.7 0.5 1.5 -2.2 0.2 3.0

Real GDP Growth (2015 e) 0.3 0.1 0.8 1.7 4.2 1.1

Real GDP Growth (2016 f) 1.1 0.1 1.1 1.3 2.8 1.1

Source: IIF

Real Non-Oil GDP Growth Rates (in %)

Real Non-Oil Growth KSA Kuwait UAE Qatar Oman Bahrain

Real GDP Growth (2008-2012 Avg) % 7.7 -1.9 2.1 13.7 5.1 5.1

Real GDP Growth (2013) % 6.3 4.8 5.4 11.0 5.2 3.1

Real GDP Growth (2014) % 5.8 3.8 5.2 12.0 7.2 4.9

Real GDP Growth (2015e) % 4.9 4.0 4.9 9.9 4.8 4.0

Real GDP Growth (2016 f) % 3.8 4.5 5.0 9.3 4.6 3.5

Source: IIF

ii. Inflation

Consumer price inflation was quite muted at 1.6% during 2015. Moderation of

rental inflation and subdued import prices are expected to keep inflation

hovering around 2% mark. For 2016, the inflation is expected to nudge up owing

to factors such as the increasing global commodity prices and a stable US Dollar.

Inflation rate (%)

Inflation (Annual Change) KSA Kuwait UAE Qatar Oman Bahrain

Inflation (2008-2012 Avg) 4.1 4.7 3.2 2.3 5.3 2.1

Inflation (2013) 3.5 2.7 1.1 3.1 1.2 3.3

Inflation (2014) 2.7 2.9 2.3 3.0 1.0 2.7

Inflation (2015 e) 2.1 3.3 3.7 1.6 0.4 2.0

Inflation (2016 f) 2.3 3.3 3.0 2.3 2.0 2.1

Source: IMF

11 Qatar Economic Outlook 2015–2017 Update

Trade and hospitality are

also expected to grow

robustly owing to

conference activities and

to growth in tourist

arrivals, particularly from

the region.

Consumer price inflation

was quite muted at 1.6%

during 2015. Moderation

of rental inflation and

subdued import prices are

expected to keep inflation

hovering around 2%

mark.

MARKAZ RESEARCH



iii. Fiscal Balance

With the oil revenues expected to fall given the long-term outlook for oil prices,

the fiscal surplus is expected to turn into fiscal deficit in 2016. Risks that Qatar is

exposed to are international in nature and hence any positive upward

momentum in oil prices would help them in shoring up their external and fiscal

balances. Qatar has got a moratorium in place for new oil & gas projects in its

country and as a result its oil production is set to decline. Furthermore, margins

on liquefied natural gas are likely to face pressures from new sources of supply

and increased competition worldwide. Depressed oil prices also increases the risk

of funding gap for new projects in the industry. Returns from Qatar’s

investments in other infrastructure assets is therefore of paramount importance

in order to keep the fiscal balance from slipping further.

Fiscal Balance as % of GDP

Fiscal Balance (% of GDP) KSA Kuwait UAE Qatar Oman Bahrain

Fiscal Balance (2008-2012 Avg) 10.2 28.2 7.0 11.4 7.4 -2.4

Fiscal Balance (2013) 5.8 34.0 10.4 20.7 3.2 -4.3

Fiscal Balance (2014) -3.4 26.3 5.0 14.7 -1.5 -5.7

Fiscal Balance (2015 e) -21.6 1.3 -5.5 4.5 -17.7 -14.2

Fiscal Balance (2016 f) -19.4 0.1 -4.0 -1.5 -20.0 -13.9

Source: IMF; Note: Fiscal balance is computed as difference between general

government revenue streams (oil revenues, taxes, grants receivable and others) and

general government expenditures (capital expense, social benefits, governmental

wages and other current expenses)

iv. Current Account Balance

Current account balance is expected to be negative in 2016 owing to reducing

hydrocarbon export revenues, rising imports (driven by domestic demand) and

higher outward remittances by foreign nationals working in Qatar. Capital-

equipment imports are expected to slow down as needs are scaled down but

given the demand for materials and by consumption demand of a larger

population the CAB should be well-supported.

Current Account Balance as % of GDP

Current Account Balance (% of GDP) KSA Kuwait UAE Qatar Oman Bahrain

Current Account Balance (2008-2012 Avg) 17.8 37.5 9.7 22.4 8.0 6.5

Current Account Balance (2013) 18.2 41.2 18.4 30.9 6.6 7.8

Current Account Balance (2014) 10.3 31.0 13.7 26.1 2.0 3.3

Current Account Balance (2015 e) -3.5 9.3 2.9 5.0 -16.9 -4.8

Current Account Balance (2016 f) -4.7 7.0 3.1 -4.5 -24.3 -5.9

Source: IMF; Note: Current account balance calculated as the sum of trade balance and

the balance on services, income and transfers.

Qatar has got a moratorium in

place for new oil & gas projects

in its country and as a result its

oil production is set to decline.

Current account balance is

expected to be negative in

2016 owing to reducing

hydrocarbon export revenues,

rising imports and higher

outward remittances by foreign

nationals working in Qatar.

MARKAZ RESEARCH



Economic Parameters Summary

Overall Scores Qatar

Economic Growth Positive

Inflation Positive

Fiscal Balance Neutral

Current Account Balance Negative

Qualitative assessment Neutral

Source: IMF, Markaz

4. Market Liquidity

Aggregate value traded of equities in Qatar reached a value of USD 23bn in

2015. This represents a 56% lower value from the value traded registered in the

prior year.

Value traded (in USD Mn) and Y-o-Y change (in %), 2005-2016

Source: Zawya; Data as of Dec 13, 2015

Value traded in Qatar markets plunged by 56% Y-o-Y in 2015 after its 34% and

154% increase in 2013 and 2014 mainly due to the country entering the MSCI

Emerging Markets Index. The declining stock prices owing to sell-off spree from

the institutional investor and fund managers was the major reason for the

decline in value traded in Qatar. Global factors were also not favorable during

2015 resulting in a wide-spread sell-off in the region post the Chinese stock

market crash in June.

345%

-29%

48% 61%

-47% -28%

22%

-31%

34%

154%

-56%

38%

-100%

-50%

0%

50%

100%

150%

200%

250%

300%

350%

400%

0

10

20

30

40

50

60

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016f

Value Traded (USD bn) Growth

Value traded in Qatar

markets plunged by 56% Y-

o-Y in 2015 after its 34%

and 154% increase in 2013

and 2014 mainly due to the

country entering the MSCI

Emerging Markets Index.

The declining stock prices

owing to sell-off spree from

the institutional investor and

fund managers was the

major reason for the decline

in value traded in Qatar.

MARKAZ RESEARCH



Stock Market Turnover Ratio (Value traded/market cap)

Source: Zawya, Markaz Research; Data as of Dec 13, 2015

MSCI upgraded Qatar to emerging market last year and it was also included in

the MSCI emerging market index last year. Unfortunately this upgrade alone has

not been sufficient enough to increase the turnover in the Qatar market. The

initial euphoria surrounding the inclusion at the beginning of 2015 faded away as

poor investor sentiment coupled with the drop in oil price, regional instability and

turmoil in Chinese equities forced international investors to review their

strategies. We expect 2016 to be much better on account of the positive steps

taken by the Qatar stock exchange on issues such as stock lending and short

selling.

Qatar Market Expectation 2016

Factors Markaz View

Earnings Growth Potential Neutral

Valuation Attraction Positive

Economic Factors Neutral

Market Liquidity Negative

2016 Market Expectation Neutral


Corporate earnings have risen in Qatar since the financial crisis owing to rising oil

& gas prices prior to first half of 2014. While the economic growth remains

positive, the fall in oil prices has increased the downside risks for the Qatari

economy. The stock market is fairly valued with a lower P/E ratio and higher

dividend yield compared to some of its peers. While the valuation is positive

other factors that complement the growth are expected to remain neutral or slip

into negative territory. Hence, on an overall basis, our expectations for Qatari

markets remain neutral in the coming year.

33% 33% 31%

63%

29%

15% 18%

12% 13%

29%

13%

20%

0%

10%

20%

30%

40%

50%

60%

70%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016f

Unfortunately this upgrade

alone has not been sufficient

enough to increase the

turnover in the Qatar

market.

While the economic growth

remains positive, the fall in

oil prices has increased the

downside risks for the Qatari

economy.

MARKAZ RESEARCH



What Next for Qatar Market after MSCI Upgrade

Possible steps to be taken in Qatar Capital Markets


Qatar was upgraded to emerging market status during June 2013 along with

UAE. Both the countries were under the review for five years before they

received the final approval. The “emerging” designation is a major sign of

approval from institutional investors for the countries' stock markets. MSCI

claimed that the positive developments in the countries’ infrastructure were the

reasons behind the upgrade of both these markets.

In the couple of months following the upgrade Qatar stock index witnessed

increased activity and its index gained by 8% before falling. This upgrade has

brought in huge fund inflows into the country’s stock market; the upgrade has

brought in $2bn in foreign funds to the exchange12. In addition to the MSCI

upgrade, Qatar has also been upgraded recently by FTSE to secondary emerging

market status which is expected to bring in additional foreign investment into the

stock market13. Despite the upgrades Qatar’s current standing leaves a lot of

scope of improvement in areas such as – Foreign ownership limits/ levels,

Clearing and settlement, transferability of stocks and short selling.

MSCI’s stance for Qatar as of June, 2015 would help us to analyse the potential

developments in the Qatar capital market that are required and might happen in

2016.

12 July 2015, Oxford Business Group, Statement of exchange CEO Al Mansoori 13 Sep 2015 – To Qatar to be added in the list in two phases – Sep 2016 and March 2017

Increased Market Activity and Liquidity

Transferability and

Off- Exchange

transaction

Expanding the scope of stock lending

Equal rights to foreign

investors

Better Corporate

Governance

Increased Foreign

Ownership

The “emerging” designation

is a major sign of approval

from institutional investors

for the countries' stock

markets.

In the couple of months

following the upgrade Qatar

stock index witnessed

increased activity and its

index gained by 8% before

falling.

MARKAZ RESEARCH



Current Stance of MSCI

Parameters Status

Classification as of June, 2015 Standalone

Openness to foreign ownership

- Investor qualification requirement

- Foreign ownership limit (FOL) level

- Foreign room level

- Equal rights to foreign investors

++

-/?

-/?

+

Ease of capital inflows/outflows

- Capital flow restriction level

- Foreign exchange market liberalization level

++

++

Efficiency of operational framework

Market Entry

- Investor registration, account setup

Market Organization

- Market Regulations

- Competitive landscape

- Information flow

Market Infrastructure

- Clearing & Settlement

- Custody

- Registry/Depository

- Trading

- Transferability

- Stock lending

- Short Selling

+

++

++

++

-/?

+

++

++

-/?

+

-/?

Stability of institutional framework +

++ No issues; + no major issues, improvements possible;

-/? improvements needed/extent to be assessed. Source: MSCI Global Market Accessibility Review, June 2015

MSCI has indicated that Qatar market have to liberalize their foreign ownership

limit which is currently fixed at maximum 49% in a company’s stock. Qatar

increased the foreign ownership from the previous limit of 25% and this proposal

was ratified during August 2015. Technical reforms such as increasing foreign

ownership can help in bringing in foreign investors. During the 2nd quarter of

2015, six companies increased their non- Qatari ownership - Qatar General

Insurance & Reinsurance Company, Qatar Insurance Company, the Commercial

Bank of Qatar and Doha Bank, Ezdan Holding and Aamal14. We can expect this

trend to continue in 2016 as well as more companies try to bring in foreign

investors on board. Increasing the ownership levels would also help bringing in

international best practices in areas such as corporate governance, shareholder

rights etc.

Foreign room level, a new adjustment factor introduced by MSCI, accounts the

proportion of investable stocks in a market to foreign investors. For equity

market to function to its fullest extent there has to be robust investor protection

14 Qatar Central Securities Depository (QCSD)

MSCI has indicated that

Qatar market have to

liberalize their foreign

ownership limit which is

currently fixed at maximum

49% in a company’s stock.

Foreign room level, a new

adjustment factor introduced

by MSCI, accounts the

proportion of investable

stocks in a market to foreign

investors.

MARKAZ RESEARCH



norms and equitable treatment towards all class and category of investors. Qatar

has taken its 1st step in achieving this goal by extending the rights of Qatari

nationals to other GCC nationals with regard to shareholding of listed Qatari

companies. This decision is part of a wider programme to expand the country’s

financial market’s base. Extending similar rights to foreigners would help in

cementing Qatar as a promising emerging market investment.

Market liquidity is a direct function of the number of active participants in the

market that are willing to buy and sell the stock and the pace at which a stock

can be sold without affecting the price too much. For this to happen there has to

be wide spread awareness about investing and trading in stock market. Market

Making in Qatar has been given a much needed boost through liquidity providers

through recent regulations.

Liquidity Provider - Exchange Agreement – It is an agreement between the

licensed LP and the Exchange, whereby the LP obtains an incentive, through

discounts on exchange transaction fees, to make markets in selected stocks. The

agreement stipulates the activity levels expected of the LP in each selected

stock, with thresholds on number or value of shares bid and offered, the amount

of time during the trading day that these bid and offers are maintained and the

maximum spread between each bid and offer. If the LP meets all of these

stipulations for a given stock, a discount on the transaction fees is accrued and

the total discount for each month is then paid to the LP by the Exchange.

Liquidity Provider – Specific Issuer - In this arrangement, the LP obtains an

incentive from the issuer for supporting liquidity in the issuer’s stock. Once again,

there are specific stipulations as to spread, number or value of shares and time

in the market applied to ensure that the LP provides the required liquidity. The

specific terms are agreed between the LP and the issuer.

In either case, a license must be granted by the regulator, the QFMA, and a copy

of the agreement and an appropriate application needs to be lodged with them.

Currently there are only two companies that provide LPs – The Group and

Commercial Bank Investment Services (CBIS). Importance of LPs become more

imperative as the Qatar Stock Exchange gears up for the launch of Exchange

Traded Funds (ETFs) and Exchange Traded Products (ETPs)

Regulatory structure in Qatar is multi-pronged. Currently Qatar Central bank,

Qatar Financial Market Authority and Qatar Financial Centre regulation are

currently responsible for the regulation of the financial markets. Consolidation of

the regulatory authorities with Qatar Central bank leading the way would bring in

more efficient policies and enforcements. Investors also prefer acting with a

single efficient regulator instead of multiple entities.

It is also anticipated that once Qatar expands down the path of allowing state

owned companies to sell shares to the public over the coming years, foreign

investors will benefit from the increased number of securities available to them in

the secondary market.

It is an agreement between

the licensed LP and the

Exchange, whereby the LP

obtains an incentive, through

discounts on exchange

transaction fees, to make

markets in selected stocks.

Foreign room level, a new

adjustment factor introduced

by MSCI, accounts the

proportion of investable

stocks in a market to foreign

investors.

MARKAZ RESEARCH



Appendix: Blue Chip Stocks

Qatar National Bank

Qatar National Bank (QNB) recorded a net profit of QR 3.1 billion in 3Q2015, up 7% YoY and 8% QoQ.

The drivers of the YoY increase in net profit were slightly higher operating income and income from

associates as well as lower provisioning. Net interest margin decreased QoQ, with net interest income up

2% YoY, down 1% QoQ, driven by strong investment income. Lower loan provisioning continued to be a

major driver of net profit growth with QNB registering net recoveries (QR 91 million) during 3Q2015.

Historical Financial Highlights

(AED mn) 2008 2009 2010 2011 2012 2013 2014 9m, 2015

Income Statement

Net Interest Income 2,836 3,726 5,675 7,799 9,150 11,560 12,262 9,547

Net Income 3,653 4,202 5,704 7,509 8,339 9,479 10,455 8,721

Balance Sheet

Total Assets 151,974 179,329 223,382 301,955 366,854 443,486 486,357 520,892

Total Liabilities 135,330 159,644 199,145 259,935 319,776 390,658 429,374 461,799

Total Equity 16,643 19,685 24,237 42,021 47,078 52,828 56,983 59,092

Key Ratios

Net Loan Growth, % 51.4 8.7 21.1 47.3 28.9 24.7 9.1 na

Deposits Growth, % 36.4 13.0 37.1 34.9 22.0 17.5 10.3 na

NPL (% loans) 0.0 0.9 1.0 1.1 1.3 1.6 1.6 1.5

LLP (% loans) 0.30 0.27 0.45 0.64 0.48 0.54 0.34 -0.03

Loans/Deposit 87% 84% 74% 81% 86% 91% 90% 89%

Tier 1 Capital Ratio 13.7 13.2 15.3 22.0 21.0 15.6 0.0 14.0

ROA, % 2.7 2.5 2.8 2.9 2.5 2.4 2.3 na

EV/EBITDA 3.3 2.8 4.8 7.8 6.3 13.1 13.5 9.2

P/E 11.1 10.7 12.5 12.2 11.0 12.7 14.2 10.0

P/B 2.5 2.3 3.0 2.3 1.9 2.3 2.6 1.9

Dividend Yield 5.5% 3.5% 3.8% 2.9% 4.6% 4.1% 3.5% 4.7%

Source: Reuters

Analyst Estimates (Mean) 2015e 2016f 2017f 2018f

Revenue (AED mn) 16,277 17,637 19,269 22,197

Net Profit (AED mn) 11,330 12,211 13,317 14,759

EPS (AED) 16.20 17.31 18.83 21.36

Book Value/Share (AED) 89.60 99.46 110.27 129.96

RoA, % 2.23 2.18 2.23 2.25

RoE, % 19.27 18.83 18.59 19.20

Source: Reuters

MARKAZ RESEARCH



Ezdan

Ezdan Holding reported a 22.6 percent rise in third-quarter net profit. This climb in the Group’s profits,

despite the economic setback that the regional markets are enduring, can be attributed to the stability of

the Qatari real estate market. Revenues of the company have been helped by the increase in rentals

income (13% YoY) during the 1st 9 month of 2015. One off gains from selling available-for-sale financial

assets increased by 24% till date.


(QAR mn) 2008 2009 2010 2011 2012 2013 2014 9m 2015

Income Statement

Revenues 388 484 392 738 527 1,117 1,601 1,357

Net Income 1,357 8,686 121 345 275 1,071 1,360 1,222

Balance Sheet

Total Assets 6,921 30,060 31,924 32,887 38,705 41,203 43,393 45,870

Total Liabilities 434 2,776 4,522 5,147 11,142 12,559 13,316 15,635

Total Equity 6,487 27,285 27,403 27,740 27,563 28,644 30,077 30,234

Key Ratios

Current Ratio (in %) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 na

Net Profit Margin (in %)

350.0 1793.0 31.0 46.8 52.3 95.9 85.0 na

Debt/Equity 0.06 0.08 0.13 0.17 0.37 0.42 0.43 0.50

ROE, % 23.4 51.4 0.4 1.3 1.0 3.8 4.6 na

ROA , % 22.4 47.0 0.4 1.1 0.8 2.7 3.2 na

EV/EBITDA 40.8 132.7 343.1 123.9 173.9 75.4 49.9 45.8

P/E 9.1 4.0 666.8 170.4 175.5 42.1 29.1 25.4

P/B 1.9 2.0 3.0 2.1 1.8 1.6 1.3 1.3

Dividend Yield N/A N/A N/A 0.7% 0.7% 1.8% 2.7% 2.7%

Source: Reuters

No brokerage covers the Ezdan stock and hence analyst estimates are not available.

MARKAZ RESEARCH



Masraf Al Rayan

Masraf Al Rayan, Qatar's second largest bank by market value, reported a 2.2 percent fall in third-quarter

net profit which is broadly in line with analysts' expectations. Net profit for the nine months to Sept. 30

was 1.51 billion riyals, compared with 1.43 billion riyals in the same period a year ago. Financing

activities for the nine-month period reached 59.9 billion riyals, up by 9.2 percent from the same period in

2014. Customer deposits totaled 52.8 billion riyals, a decline of 12 percent over the same period.

Earnings have been propelled in recent years by public spending related to a raft of infrastructure

projects as the government prepares to host the soccer World Cup in 2022.


(QAR mn) 2008 2009 2010 2011 2012 2013 2014 9m 2015

Income Statement

Net Interest Income 1,078 713 1,134 1,407 1,738 1,977 2,061 1,602

Net Income 917 881 1,211 1,408 1,504 1,702 2,002 1,514

Balance Sheet

Total Assets 16,769 24,124 34,683 55,271 61,628 66,548 80,094 79,539


Total Equity 5,694 5,962 7,126 8,504 9,596 10,523 11,353 11,541

Key Ratios


Deposits Growth, % 120.5 63.6 51.5 71.2 11.1 7.2 21.8 na

Nonperforming loans (% loans) 0.8 1.5 0.0 0.0 0.0 0.1 0.1 0.1

Loan loss provision (% loans) 0.00 0.05 0.01 0.21 -0.08 -0.02 0.02 0.00

Loans/Deposit 134% 123% 111% 84% 88% 83% 91% 94%

Tier 1 Capital Ratio 31.9 24.1 19.1 0.0 0.0 0.0 18.4 NULL

ROA, % 6.8 4.3 4.1 3.1 2.6 2.7 2.8 na

EV/EBITDA 8.3 10.5 10.4 13.0 10.7 11.5 14.8 11.7

P/E 9.0 11.5 11.8 14.8 12.4 13.8 16.6 13.0

P/B 1.4 1.7 2.0 2.5 1.9 2.2 2.9 2.3

Dividend Yield 7.5% N/A N/A 1.8% 4.0% 4.8% 4.0% 4.8%

Source: Reuters


Revenue (AED mn) 2,563 2,743 2,931 3,583

Net Profit (AED mn) 1,992 2,076 2,133 2,423

EPS (AED) 2.71 2.77 2.84 3.09

Book Value/Share (AED) 15.92 17.11 18.17 22.68

RoA, % 2.35 2.30 2.20 2.10

RoE, % 18.90 18.30 18.50 NULL

Source: Reuters

MARKAZ RESEARCH



Industries Qatar

Industries Qatar (IQ) reported a 3Q2015 net income of QAR 1.40 billion (-25% YoY, -4% QoQ). The

petrochemicals segment contributed 56% of IQ’s 3Q2015 bottom line compared with a contribution of

24% and 20% from the fertilizers and steel segments, respectively. The performance was better than

expectations across all segments, primarily supported by higher-than-expected sales volumes. The

company reported that sales volumes grew by over 12% YoY while we were expecting sales volumes to

increase 1.5%.The steel segment revenue declined 20% QoQ to QAR 1.22 billion, and was in line with

analyst expectation of QAR 1.21 billion. Better inventory management helped in supporting higher

margins for the quarter.


(QAR mn) 2008 2009 2010 2011 2012 2013 2014 9m 2015

Income Statement Revenues 14,743 9,857 12,331 16,549 6,154 5,823 5,970 4,107

Net Income 7,276 4,959 5,478 7,931 8,441 8,012 6,342 3,831

Balance Sheet Total Assets 27,450 27,432 31,908 36,778 32,887 36,778 36,556 35,304


Total Equity 18,243 19,056 21,651 26,237 30,334 33,777 33,585 33,169

Key Ratios

Current Ratio (in %) 2.8 4.7 2.9 3.2 9.7 10.8 4.5 na

Net Profit Margin (in %)

49.3 50.3 44.4 47.9 141.8 137.5 106.2 na

Debt/Equity 0.33 0.33 0.35 0.26 0.05 0.06 0.05 0.04

ROE, % 45.6 26.6 26.9 33.1 30.9 25.0 18.8 na

ROA , % 30.6 18.1 18.5 23.1 25.1 23.0 17.3 na

EV/EBITDA 7.2 16.0 13.5 8.5 39.3 52.4 64.4 45.7

P/E 7.6 12.7 13.9 9.2 9.8 12.8 16.0 11.5

P/B 3.0 3.3 3.5 2.8 2.6 3.0 3.0 1.9

Dividend Yield 8.0% 4.4% 4.0% 5.6% 5.0% 6.5% 4.2% 6.7%

Source: Reuters


Revenue (AED mn) 5,384 5,053 4,919 5,247

EBITDA (AED mn) 1,134 1,111 1,168 1,200

Net Profit (AED mn) 4,916 5,158 5,122 5,515

CapEx (AED mn) 460 479 304 500

EPS (AED) 8.16 8.53 8.28 9.12

Book Value/Share (AED) 55.18 56.38 57.06 NULL

RoA, % 15.07 16.67 14.40 NULL

RoE, % 14.87 14.81 14.71 NULL

Source: Reuters

MARKAZ RESEARCH



Qatar Islamic Bank

Qatar Islamic Bank (QIB), the largest sharia-compliant lender by assets, reported a 27 percent jump in

third-quarter net profit. QIB made a nine-month net profit of 1.41 billion riyals, up from 1.13 billion riyals

a year earlier. Nine-month income from financing and investing activities was 2.8 billion riyals, up 24

percent year-on-year. The bank's net fee and commission income over the same period was 345 million

riyals, 19 percent higher than a year ago.

Historical Financial highlights

(QAR mn) 2008 2009 2010 2011 2012 2013 2014 9m 2015

Income Statement

Net Interest Income 939 1,306 1,305 1,366 1,620 1,381 1,706 1,526

Net Income 1,643 1,322 1,262 1,365 1,241 1,335 1,601 1,410

Balance Sheet

Total Assets 33,543 39,273 51,877 58,275 73,192 77,354 96,106 1,22,707

Total Liabilities 26,400 30,268 42,826 47,072 61,718 65,495 83,628 1,07,813

Total Equity 7,143 9,005 9,052 11,202 11,474 11,860 12,478 14,895

Key Ratios


Deposits Growth, % 60.0 14.9 33.5 6.2 29.9 -2.6 28.1 na

Nonperforming loans (% loans) 1.4 1.1 1.3 0.0 0.0 9.3 4.4 0.6

Loan loss provision (% loans) -0.31 0.15 0.19 0.04 0.52 0.20 0.15 0.03

Loans/Deposit 75% 78% 76% 72% 81% 101% 102% 91%

Tier 1 Capital Ratio 16.4 17.3 17.4 0.0 14.6 15.7 13.9 NULL

ROA, % 6.2 3.6 2.8 2.2 1.8 1.8 1.9 na

EV/EBITDA 5.1 4.3 4.6 10.4 8.0 13.7 15.8 11.7

P/E 9.8 12.1 13.7 14.3 13.8 12.2 15.1 14.1

P/B 2.3 1.8 1.9 1.8 1.5 1.4 1.9 1.8

Dividend Yield 8.5% 7.7% 6.2% 5.3% 5.0% 5.8% 4.2% 3.8%

Sources: Reuters


Revenue (QAR mn) 3,324 3,925 4,356 6,154

Net Profit (QAR mn) 1,838 2,087 2,369 2,932

EPS (QAR) 7.78 8.83 10.03 13.33

Book Value/Share (QAR) 55.29 59.59 64.81 73.36

RoA, % 1.65 1.45 1.55 1.50

RoE, % 15.45 16.60 17.00 NULL

Source: Reuters

Qatar Large Cap


(USD mn) Last


Div. Yield

ADTV

MARKAZ RESEARCH



Qatar National Bank SAQ Financials 33,624 175 -18% 11.0 2.1 0.71 4.3 High

Industries Qatar QSC Industrials 18,457 111.1 -34% 12.3 2.0 1.00 6.3 High

Ezdan Holding Group QSC Financials 11,581 15.9 7% 26.9 1.4 1.48 2.5 High

Masraf Al Rayan QSC Financials 7,743 37.6 -15% 13.5 2.4 1.26 4.7 High

Qatar Islamic Bank SAQ Financials 6,923 106.7 4% 13.4 1.7 1.13 4.0 High


Basic Materials 6,692 19.4 -34% 20.2 1.8 na 5.7 High

Ooredoo QSC Telecommunications

Services 6,597 75 -39% 13.2 1.1 1.02 5.3 High


Utilities 6,536 216.4 15% 15.9 3.4 0.85 3.5 High

Barwa Real Estate Co QSC Financials 4,274 40 -5% 2.6 0.9 1.39 5.5 High

Qatar Insurance Co SAQ Financials 4,157 82 4% 16.0 2.7 0.79 2.7 High

Source: Reuters

Qatar Mid-Cap


(USD mn) Last


Div. Yield

ADTV

Gulf Warehousing Co QSC Industrials 929 56.9 11% 17.1 3.2 0.87 2.4 High

Medicare Group QSC Healthcare 922 119.3 2% 17.1 3.7 1.36 4.2 High



Zad Holding Co SAQ Consumer Non-

Cyclicals 502 84.8 1% 9.8 1.4 0.42 4.7 Average

Source: Reuters

Qatar Small Cap


(USD mn) Last


Div. Yield

ADTV

Mazaya Qatar Real Estate Development QSC

Financials 409 14.2 -22% 8.6 1.1 1.23 2.0 High

Salam International Investment QSC


Qatar Islamic Insurance Co QSC

Financials 297 72 -9% 13.1 3.2 0.89 5.6 High

Doha Insurance Co QSC Financials 288 21 -28% 15.5 1.0 0.71 4.8 Low

Widam Food Co QSC Consumer Non-

Cyclicals 261 52.8 -13% 14.1 3.7 0.92 4.7 High

Al Khaleej Takaful Group QSC Financials 214 30.5 -31% 15.1 1.3 0.79 4.3 High

Alijarah Holding Co QSC Industrials 192 14.1 -30% nm 0.6 0.79 6.0 High


Financials 144 18.49 -45% nm 1.9 1.13 0.0 High

Islamic Holding Group QSC Financials 130 78.7 -25% 38.0 6.1 0.32 3.2 High

Qatar Oman Investment Co QSC


Source: Reuters

Qatar High Dividend Yield Stocks

Companies Sector Category M. Cap

(USD mn) Last


Div. Yield

ADTV

MARKAZ RESEARCH



Gulf International Services QSC Industrials

2,628 Large Cap 51.5 -47% 6.6 2.4 1.30 10.7 High

Doha Bank QSC Financials

3,157 Large Cap 44.5 -22% 9.3 0.9 0.87 9.0 High


Industrials

520 Mid Cap 39.85 -8% 13.0 1.3 0.49 7.5 High

Commercial Bank QSC Financials

4,117 Large Cap 45.9 -26% 9.0 0.9 0.77 6.9 High

Aamal Co QSC Industrials

2,420 Large Cap 13.99 -3% 14.1 1.2 0.94 6.8 High


Industrials

106 Small Cap 12.3 -20% 15.7 1.1 0.95 6.5 High

Industries Qatar QSC Industrials

18,457 Large Cap 111.1 -34% 12.3 2.0 1.00 6.3 High

Mannai Corporation QSC Industrials

1,194 Large Cap 95.3 -13% 8.2 1.9 0.54 6.3 High

Qatar International Islamic Bank QSC

Financials

2,673 Large Cap 64.3 -21% 11.4 1.8 1.07 6.2 High

Qatar Fuel QSC Energy

3,421 Large Cap 147.5 -28% 10.7 1.9 0.60 6.1 High

Source: Reuters

Qatar High Beta Stocks

Companies Sector Category M. Cap (USD

mn) Last

Close 2015 P/E P/B Beta ADTV

Ezdan Holding Group QSC Financials 11,581 Large Cap 15.9 7% 26.9 1.4 1.48 High

Barwa Real Estate Co QSC Financials 4,274 Large Cap 40 -5% 2.6 0.9 1.39 High

Medicare Group QSC Healthcare

922 Mid Cap 119.3 2% 17.1 3.7 1.36 High

Vodafone Qatar QSC Telecommunications

Services 2,948 Large Cap 12.7 -23% nm 2.1 1.36 High

Gulf International Services QSC Industrials 2,628 Large Cap 51.5 -47% 6.6 2.4 1.30 High

Masraf Al Rayan QSC Financials 7,743 Large Cap 37.6 -15% 13.5 2.4 1.26 High


Financials

409 Small Cap 14.2 -22% 8.6 1.1 1.23 High


Financials

144 Small Cap 18.49 -45% nm 1.9 1.13 High

Qatar Islamic Bank SAQ Financials 6,923 Large Cap 106.7 4% 13.4 1.7 1.13 High


Financials 2,673 Large Cap 64.3 -21% 11.4 1.8 1.07 High

Source: Reuters

MARKAZ RESEARCH



Asset Classes: Risk-Return Profile (2015)

Source: Reuters Eikon, Markaz Research

Asset Classes: Risk-Return Profile (2010 - 2015)

Source: Reuters Eikon, Markaz Research

IPE Brent

MSCI EM S&P GCC KSA

Kuwait Price Idx Qatar

Oman

Bahrain Dubai

Abu Dhabi

KWT Wt Idx

(40)

(35)

(30)

(25)

(20)

(15)

(10)

(5)

-

- 10 20 30 40 502015 Returns

(%)

2015 Risk (%)

IPE Brent

MSCI EM

S&P GCC KSA

Kuwait Price Idx

Qatar

Oman Bahrain

Dubai

Abu Dhabi

KWT Wt Idx

(20)

(15)

(10)

(5)

-

5

10

15

20

- 5 10 15 20 25 30 35

Annualized Returns, %

(2011-2015)

Annualized Risk (%) (2011-2015)

MARKAZ RESEARCH



PE Band Charts

Figure: PE Band of QSI Index

Source: Reuters

Monthly Index Returns

Qatar Index

Abu Dhabi

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec YTD Value of $1 Invested in 2009 Jan

2009 -

24% -

16% 10% 15% 25% -7% 3% 6% 4% -4% 1%

-3% 1% 1.01

2010 -6% 5% 9% 1% -

10% 2% 2% 3% 6% 1% 4%

7% 25% 1.26

2011 1% -9% 7% 1% -2% 0% 0% -1% 1% 2% 0% 2% 1% 1.27

2012 -2% 2% 1% -1% -3% -3% 2% 2% 0% 0% -2% 0% -5% 1.21

2013 4% -2% 1% 1% 6% 0% 5% -1% 0% 2% 5% 0% 24% 1.51

2014 7% 6% -1% 9% 8% -

16% 12% 6% 1% -2% -5%

-4% 18% 1.78

2015 -3% 5% -6% 4% -1% 1% -3% -2% -1% 1% -

13% 3% -

15% 1.51

Source: Reuters Eikon

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000N

ov-1

1

Jan-1

2

Mar-

12

May-1

2

Jul-12

Sep-1

2

Nov-1

2

Jan-1

3

Mar-

13

May-1

3

Jul-13

Sep-1

3

Nov-1

3

Jan-1

4

Mar-

14

May-1

4

Jul-14

Sep-1

4

Nov-1

4

Jan-1

5

Mar-

15

May-1

5

Jul-15

Sep-1

5

Nov-1

5

QSI Index 10x 15x 20x 30x

MARKAZ RESEARCH



Qatar Stock List

Companies M. Cap (USD mn)

Category Last


Div. Yield

ADTV

Qatar Banks

Al Khalij Commercial Bank QSC

1,776

Large Cap 17.97 -19% 10.4 1.1 0.59 5.6 High

Alijarah Holding Co QSC

192 Small Cap 14.1 -30% nm 0.6 0.79 6.0 High

Commercial Bank QSC

4,117 Large Cap 45.9 -26% 9.0 0.9 0.77 6.9 High


144

Small Cap 18.49 -45% nm 1.9 1.13 0.0 High

Doha Bank QSC

3,157 Large Cap 44.5 -22% 9.3 0.9 0.87 9.0 High

Islamic Holding Group QSC

130

Small Cap 78.7 -25% 38.0 6.1 0.32 3.2 High

Masraf Al Rayan QSC

7,743 Large Cap 37.6 -15% 13.5 2.4 1.26 4.7 High

Qatar National Bank SAQ

33,624

Large Cap 175 -18% 11.0 2.1 0.71 4.3 High

Qatar Islamic Bank SAQ

6,923 Large Cap 106.7 4% 13.4 1.7 1.13 4.0 High


2,673

Large Cap 64.3 -21% 11.4 1.8 1.07 6.2 High


106

Small Cap 12.3 -20% 15.7 1.1 0.95 6.5 High

Qatar Real Estate

Barwa Real Estate Co QSC

4,274

Large Cap 40 -5% 2.6 0.9 1.39 5.5 High

Ezdan Holding Group QSC

11,581

Large Cap 15.9 7% 26.9 1.4 1.48 2.5 High


409

Small Cap 14.2 -22% 8.6 1.1 1.23 2.0 High

United Development Co PSC

2,017

Large Cap 20.75 -12% 11.1 0.7 0.99 6.0 High

Qatar Industry

Aamal Co QSC

2,420 Large Cap 13.99 -3% 14.1 1.2 0.94 6.8 High

Gulf International Services QSC

2,628

Large Cap 51.5 -47% 6.6 2.4 1.30 10.7 High

Industries Qatar QSC

18,457 Large Cap 111.1 -34% 12.3 2.0 1.00 6.3 High

Mannai Corporation QSC

1,194 Large Cap 95.3 -13% 8.2 1.9 0.54 6.3 High


6,692

Large Cap 19.4 -34% 20.2 1.8 na 5.7 High


6,536

Large Cap 216.4 15% 15.9 3.4 0.85 3.5 High

Qatari Investors Group QSC

1,287

Large Cap 37.7 -9% 19.6 2.0 1.06 2.0 High


520

Mid Cap 39.85 -8% 13.0 1.3 0.49 7.5 High

Qatar National Cement Co QSC

1,513

Large Cap 102 -15% 12.3 2.0 0.56 3.6 High

Qatar Consumer Goods

Al Meera Consumer Goods Co QSC

1,208

Large Cap 220 10% 21.7 3.3 0.92 4.1 High

MARKAZ RESEARCH



Medicare Group QSC

922 Mid Cap 119.3 2% 17.1 3.7 1.36 4.2 High

Qatar Cinema and Film Distribution Co QSC

59

Small Cap 34 -15% 15.7 1.5 0.61 2.7 Low

Qatari German Company for Medical Devices QSC

44

Small Cap 13.72 35% nm 1.0 0.67 0.0 High

Salam International Investment QSC

371

Small Cap 11.82 -25% 17.6 0.8 0.66 5.1 High

Widam Food Co QSC

261 Small Cap 52.8 -13% 14.1 3.7 0.92 4.7 High

Qatar Fuel QSC

3,421 Large Cap 147.5 -28% 10.7 1.9 0.60 6.1 High

Zad Holding Co SAQ

502 Mid Cap 84.8 1% 9.8 1.4 0.42 4.7

Average

Qatar Transport

Gulf Warehousing Co QSC

929

Mid Cap 56.9 11% 17.1 3.2 0.87 2.4 High

Qatar Navigation QSC

2,987 Large Cap 95 -5% 9.1 0.8 0.74 5.8 High

Qatar Gas Transport Co Ltd

3,552

Large Cap 23.35 1% 13.5 3.5 0.73 5.1 High

Qatar Telecom

Ooredoo QSC

6,597 Large Cap 75 -39% 13.2 1.1 1.02 5.3 High

Vodafone Qatar QSC

2,948 Large Cap 12.7 -23% nm 2.1 1.36 1.7 High

Qatar Insurance

Al Khaleej Takaful Group QSC

214

Small Cap 30.5 -31% 15.1 1.3 0.79 4.3 High

Doha Insurance Co QSC

288 Small Cap 21 -28% 15.5 1.0 0.71 4.8 Low

Qatar Islamic Insurance Co QSC

297

Small Cap 72 -9% 13.1 3.2 0.89 5.6 High

Qatar General Insurance and Reinsurance Co SAQ

1,116

Large Cap 51.1 0% 4.1 0.7 0.22 3.4

Average

Qatar Insurance Co SAQ

4,157 Large Cap 82 4% 16.0 2.7 0.79 2.7 High

MARKAZ RESEARCH



Disclaimer

This report has been prepared and issued by Kuwait Financial Centre K.P.S.C. (Markaz), which is regulated by the Central Bank

of Kuwait. The report is owned by Markaz and is privileged and proprietary and is subject to copyrights. Sale of any copies of

this report is strictly prohibited. This report cannot be quoted without the prior written consent of Markaz. Any user after

obtaining Markaz permission to use this report must clearly mention the source as “Markaz“. The report is intended to be

circulated for general information only and should not to be construed as an offer to buy or sell or a solicitation of an offer to

buy or sell any financial instruments or to participate in any particular trading strategy in any jurisdiction.

The information and statistical data herein have been obtained from sources we believe to be reliable but no representation or

warranty, expressed or implied, is made that such information and data is accurate or complete, and therefore should not be

relied upon as such. Opinions, estimates and projections in this report constitute the current judgment of the author as of the

date of this report. They do not necessarily reflect the opinion of Markaz and are subject to change without notice. Markaz has

no obligation to update, modify or amend this report or to otherwise notify a reader thereof in the event that any matter

stated herein, or any opinion, projection, forecast or estimate set forth herein, changes or subsequently becomes inaccurate,

or if research on the subject company is withdrawn.

This report may not consider the specific investment objectives, financial situation and the particular needs of any specific

person who may receive this report. Investors are urged to seek financial advice regarding the appropriateness of investing in

any securities or investment strategies discussed or recommended in this report and to understand that statements regarding

future prospects may not be realized. Investors should note that income from such securities, if any, may fluctuate and that

each security’s price or value may rise or fall. Investors should be able and willing to accept a total or partial loss of their

investment. Accordingly, investors may receive back less than originally invested. Past performance is not necessarily indicative

of future performance.

Kuwait Financial Centre S.A.K (Markaz) does and seeks to do business, including investment banking deals, with companies

covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could

affect the objectivity of this report. This report may provide the addresses of, or contain hyperlinks to, websites. Except to the

extent to which the report refers to website material of Markaz, Markaz has not reviewed the linked site and takes no

responsibility for the content contained therein. Such address or hyperlink (including addresses or hyperlinks to Markaz’s own

website material) is provided solely for your convenience and information and the content of the linked site does not in any

way form part of this document. Accessing such website or following such link through this report or Markaz’s website shall be

at your own risk.

For further information, please contact ‘Markaz’ at P.O. Box 23444, Safat 13095, Kuwait; Email: [email protected] ; Tel:

00965 1804800; Fax: 00965 22450647.


Research Library (Complimentary Research)

Capital Markets

Research

Qatar Stock Market Outlook (2016)

KSA Stock Market Outlook (2016)

UAE Stock Market Outlook (2016)

GCC WACC (2015)

Berkshire Hathaway (2015)

Apple (2015)

Mother of All IPOs - National Commercial Bank

(2015)

Saudi Arabian Markets Set to Open (2014)

MENA Asset Management Policy Perspectives

(2013)

Including GCC in the MSCI EM Index (2012)

Alpha Abound: A Study to explore Alpha generation

in GCC (2012)

Kuwait Investment Sector (2012)

GCC Defensive Bellwether Stocks (2012)

Kuwait 15 Index (2011)

GCC SWFs: The Golden Portfolio (2010)

Persistence in performance: The GCC Experience

(2010)

Will GCC catch up with GEM? -What is left for 2009

This Too Shall Pass: What can we expect in 2009 for

GCC Markets? (2009)

Missing the rally (2009)

Fishing in Troubled Waters (2008)

Down and Out: Saudi Stock Outlook (2008)

Mr. GCC Market-Manic Depressive (2008)

To Yield or Not To Yield: Examining the Potential of

Yield Stocks in GCC (2008)

China and India: Too Much Too Fast(2007)

Kuwait Asset Management Industry (2007)

A Gulf Emerging Portfolio: And Why Not? (2007)

Derivatives Market in GCC (2007)

Managing GCC Volatility (2007)

Regulatory

Research

GCC Regulatory Digest (Semi-Annual)

Kuwait’s new Law on Preference Shares (2015)

Kuwait's BOT law (2014)

Land Reforms in Kuwait (2014)

Kuwait’s PPP Law (2013)

Bankruptcy Law in the GCC (2013)

Got a CMA (Kuwait): What Next? (2012)

The New Regulations for Kuwait Investment

Sector (2010)

Wanted: A Kuwait Capital Market Authority

(2010)

To Leap or To Lag: Choices before GCC

Regulators (2007)

Policy Research

Kuwait Reforms (Series) - Education

Oil & Gas Markets and the Emergence of New

Resources (2014)

GCC Countries & Asia: Bolstering Energy Ties

(2014)

GCC Energy Strategies: The Way Forward (2014)

Blueprint for Public Sector Good Governance in

Kuwait (2013)

Kuwait - Private Labor Market (2013)

Kuwait - Alternatives for Power Generation

(2013)

Kuwait - Sustainable Power Strategy (2012)

Tools to Strengthen & Support Kuwait's Private

Sector (2012)

Daily

Morning Brief Fixed Income Update

Kuwait Daily

Monthly

MENA Markets Review

International Market Update

Quarterly

Marmore Bulletin

Half yearly

GCC Regulatory Digest

GCC Corporate Earnings

Annual

Stock Market Outlook UAE, KSA, Qatar

Equity Risk Premium

Periodic

Reports

GCC Liquidity Fall (2015)

Is China Stalling? (2015)

Crowdfunding in the GCC (2015)

Iran Nuclear Deal (2015)

Kuwait – Dealing with Construction Permits

(2015)

Dubai Government Summit 2015 (2015)

Negative Interest Rates (2015)

Central Bank Shocks (2015)

Fiscal Breakeven Oil Price (2015)

Kuwait – starting Business (2015)

Kuwait Electricity Tariff Hikes (2015)

Basel III Norms (2015)

Kuwait Real Estate (2015)

Swiss Franc (2015)

Cheaper Oil (2015)

Rising Fuel Prices in Kuwait (2015)

GCC Research Knowledge Gap (2014)

Cloud Computing (2014)

GCC Free Trade Zones (2014)

Disruptive Technology: Bitcoins (2014)

The Internet of Things ! Big Data (2014)

Kuwait Credit Growth (2014)

Kuwait SME’s (2014)

FIFA World Cup 2022 (2013)

Economic

Research

A subsidiary www.e-marmore.com

Research Library (Paid Research)

A subsidiary

Infrastructure

Research*

Power

Egypt MENA (Ex- GCC)

Kuwait KSA

Qatar UAE

Ports

KSA UAE

Kuwait Oman

Qatar

Aviation

Qatar GCC Full Service

Carriers

GCC Low Cost Carriers Kuwait

KSA UAE

Water

Qatar KSA

Kuwait

ICT

UAE KSA

Qatar Kuwait

Roads and Railways

GCC KSA

Qatar

Real Estate

GCC Office RE KSA Office RE

GCC Affordable Housing

Residential RE – GCC, UAE, KSA, Qatar

Industry

Research*

Private Equity

GCC

Brokerage

KSA

Offsets in the GCC

GCC

Healthcare

GCC, KSA

Education

GCC, KSA, UAE

Family Business

GCC

Wealth Management

GCC, UAE

Banking

Kuwait, KSA, UAE, Qatar

Hospitality

GCC, KSA

Retail

GCC, KSA; Luxury - GCC, Kuwait, UAE;

Online – GCC

Asset Management

MENA, KSA, UAE, Egypt

Islamic Finance

GCC

Investment Banking

GCC, UAE

Insurance

GCC, KSA

Media

GCC , UAE

Social Media

GCC, UAE

Petrochemicals

GCC, Kuwait, KSA

Contracting

Kuwait, KSA, UAE

Metals & Mining

GCC

Women Investors

GCC

Company

Reports*

KSA

Al Rajhi Bank

Almarai Group

Company for Cooperative Insurance (Tawuniya)

Jarir Marketing Co.

National Commercial Bank (NCB)

Riyad Bank

SABIC

Samba

Saudi Arabian Fertilizers Co.

Saudi Arabian Mining Company

Saudi British Bank

Saudi Cement Company

Saudi Electricity Co

Saudi Telecom

Savola Group

TASNEE National Industrialization Company

The National Shipping Co. of Saudi Arabia –

BAHRI

Qatar

Barwa Real Estate Co QSC

Commercial Bank of Qatar

Ooredoo

Qatar Electricity and Water Company

Qatar Insurance Co

Qatar National Bank

UAE

Abu Dhabi Commercial Bank

Abu Dhabi National Hotels Co

Air Arabia

Aldar Properties PJSC

Arab National Bank

Arabtec Holding Company

Aramex

Dubai Islamic Bank

EMAAR Properties

Emirates NBD

Emirates Telecom

First Gulf Bank

National Bank of Abu Dhabi

*Paid reports ranging from

US$100-$500

www.e-marmore.com

Subscription Options

A subsidiary

Selective Access

www.e-marmore.com

Download up to 5 paid reports in a year

• Select and download 5 reports from our database of paid research reports. Subscription is

valid for a year.

• New reports are constantly being added to our database, providing an option to download

latest reports within the subscription period.

Wide Access

Download up to 10 paid reports in a year

• Select and download 10 reports from our database of paid research reports. Subscription is

valid for a year.



USD 2,000 / Yr.

USD 1,000 / Yr.

Unrestricted Access

Access and download all our paid reports for a year

• Select and download any report from our database of paid research reports. Subscription is

valid for a year.



Best

Value USD 3,000 / Yr.

Note:

• The above pricing is to obtain a single user license to use the PDF report file for one user only. If you

wish to subscribe for more than one user, please send us an enquiry at [email protected]

• Select reports priced US$1,000 and more are excluded from the Subscription Packages.

• For reports that are available for download on “On Request”, the subscriber will be required to send the

request.

Marmore MENA Intelligence A ‘Markaz’ Subsidiary

About Marmore Marmore MENA Intelligence Ltd. (Marmore) caters to the growing research and information needs of

organizations in the Middle East and North Africa (MENA) region. We offer full-fledged research services

covering economies, capital markets, sectors and companies - focused on the MENA region.

We also provide research services to assist our clients in investment decision-making, scanning markets to

identify investment opportunities, conducting ad-hoc researches to understand niche market segments, and

other need-based, bespoke researches.

To know more about us, please visit our website at www.e-marmore.com or write to us on

[email protected] or call us at +965-2224 8280.

A subsidiary www.e-marmore.com

Research On Demand We conduct customized researches based on specific requirements of our clients

Understand client’s

requirements

Develop

scope of

work

Identify

required

deliverables

Plan research

activities

Develop estimated

effort for research

work

Gather

research

data

Analyze

data

Prepare report

and presentation

Research

Process

Client’s

requirements

Client’s

briefing

to Marmore

Marmore

conducts the

research

Report

presentation

to client

Meeting specific

requirements

Overcoming

research

challenges

Cost

effectiveness

Focus on quality

Access to large

database

End-to-end

solutions

Government

bodies

Policy makers

Asset

Management

companies

Investment

Banks

Stock brokers

Consultants &

Audit firms

Corporate and

SMEs

Challenges

Cost

Times

Scope

Data

Resources

Management

Outcomes

Information on

client’s

specific

requirements

Greater

confidence

Customized

solutions

Comprehensive

research

scope

Research Methodology

Research Rationale

Key Beneficiaries

Research on Demand

المركزدراسات وأبحاث 2016يناير – 2016 القطريةالتوقعات المستقبلية للسوق

3المركز المالي الكويتي "المركز" |

2015-2007، األداء )كنسبة مئوية(، قطر الشكل: مؤشر

المصدر: رويترز

34%

-28%

1%

25%

1%

-5%

24%

18%

-15%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

2007 2008 2009 2010 2011 2012 2013 2014 2015

المركزدراسات وأبحاث 2016يناير – 2016 القطريةالتوقعات المستقبلية للسوق

2المركز المالي الكويتي "المركز" |

: نظرة حياديةاالقتصاد

( 2016% في العام 4.9من المتوقع أن يكون النمو في قطر معتدالً )نمو الناتج المحلي اإلجمالي الحقيقي بنسبة

فاق بنسبة د أعلنت في ميزانيتها األخيرة عن خفض اإلنبسبب خفض اإلنفاق المقرر. وكانت الحكومة القطرية ق

ومن المتوقع أن الكبرى. البنية التحتية مشاريع مليار دوالر أمريكي. ولم يمس خفض اإلنفاق 55% إلى 7.28

يؤثر هذا الخفض على الهيئات والمؤسسات التي تمولها الدولة ومنها على سبيل المثال متاحف قطر، ومؤسسة

االقتراض من الخارج ومن أسواق المنطقة لتمويل عجزها يًضا أنها تنوي كما أعلنت الحكومة أ. 1قطر، والجزيرة

بدالً من استخدام احتياطياتها. وبالنظر إلى التكلفة المترتبة على االقتراض، فإننا نتوقع أن تستثمر الحكومة القطرية

د األموال المقترضة في قطاعات تسهم بشكل إيجابي في االقتصاد الوطني. كما أنه من المتوقع أن يتحول رصي

. 2016% خالل العام 3.9الحساب الجاري إلى سلبي، ويتوقع صندوق النقد الدولي أن يبلغ عجز الحساب الجاري

وبناًء على ما ورد أعاله، جاءت نظرتنا إلى االقتصاد القطري حيادية.

سلبيةسيولة السوق: نظرة

23لتصل إلى % 56للسنة بنسبة مع تراجع القيمة المتداولة 2015% في العام 13بلغ معدل دوران األسهم

وال تزال قطر بعيدة جًدا عن معدل مليار دوالر أمريكي في السنة السابقة. 41مليار دوالر أمريكي بعد تسجيلها

قد شهد نشاًطا استثمارًيا كبيًرا 2014وكان العام %. 93الدوران السائد في سوق المملكة العربية السعودية والبالغ

إلى مؤشر مورغان ستانلي كابيتال إنترناشونال لألسواق الناشئة. ولذلك فإن قطرلك السنة إضافة بعد أن تم خالل ت

الوصول إلى الحد األقصى لالستثمارات األجنبية المسموح بها عن التراجع في القيمة المتداولة يمكن أن يكون ناتًجا

جانب ذلك نتج سوء أداء السوق عن التباطؤ وغياب أي فرص أخرى لتوظيف استثمارات جديدة. وإلى في األسهم

سلبي في أوساط المستثمرين. صينية وما تسبب به ذلك من شعور االقتصادي العالمي وتدهور أوضاع األسواق ال

هذه العوامل على إقبال المستثمرين حول العالم، فإننا ال نتوقع حصول تحسن في المتالحقة ل تأثيراتلنظًرا لو

. كذلك لم تصدر أي طروحات أولية لالكتتاب العام في قطر خالل 2016ي األسواق في العام الكميات المتداولة ف

بسبب تدني إقبال المستثمرين. وبناًء عليه، فإن نظرتنا إلى السيولة في البورصة القطرية سلبية. 2015العام

بنظرة إيجابية، وبالتالي فإننا وباإلجمال، فإننا نعتقد أن عامالً واحًدا من أربعة عوامل للسوق القطرية يصنف

نتمسك بنظرتنا الحيادية للسوق القطرية.

1 أخبار الدوحة

كانت الحكومة القطرية قد

أعلنت في ميزانيتها األخيرة عن

% 7.28خفض اإلنفاق بنسبة

.مليار دوالر أمريكي 55إلى

نتج سوء أداء السوق عن

التباطؤ االقتصادي العالمي

األسواق وتدهور أوضاع

صينية وما تسبب به ذلك من ال

سلبي في أوساط شعور

.المستثمرين

"المركز" المركز المالي الكويتي الدراسات واألبحاث

2016 القطريةللسوق التوقعات المستقبلية

حيادية -النظرة

2016التوقعات للعام : 1الجدول

التوقعات الحالية قطر

العوامل االقتصادية حياديةنظرة

جاذبية القيمة السوقية إيجابيةنظرة

احتماالت نمو األرباح حياديةنظرة

سيولة السوق سلبيةنظرة

النظرة العامة للسوق حياديةنظرة

دراسات وأبحاث المركزالمصدر:

كانت نظرتنا إيجابية في تقييمنا للسوق القطرية السنة الماضية. غير أن التراجع المفاجئ والمستمر في أسعار

. وقد أدى التراجع في 2015% خالل العام 15 بلغمؤشر بورصة قطر كبير في النفط أدى إلى تراجع

رباح تبقى على ما هي عليه دون أي تنا لنمو األامستويات المؤشر إلى جعل القيم السوقية جذابة، غير أن توقع

تغيير للسنة المقبلة. وعلى الرغم من تضمين السوق القطرية في مؤشر مورغان ستانلي كابيتال إنترناشونال

لألسواق الناشئة، غير أن الشعور السلبي السائد في أوساط المستثمرين في ظل تراجع أسعار السلع، وعلى

إلى تأثير غير مؤاٍت على قطر في المدى المتوسط. وإلى جانب ذلك، األخص أسعار الغاز، يمكن أن يؤدي

فقد أدت أسعار النفط المنخفضة إلى تحول تام في ميزان االقتصاد العالمي. وأصبح لزاًما على جميع دول

مجلس التعاون الخليجي التعايش مع أسعار النفط المنخفضة والتي باتت تمثل مساًرا مستجًدا. ونتيجة للفترة

لطويلة من التراجع في أسعار النفط، بادرت معظم الهيئات الدولية ومنها على سبيل المثال صندوق النقد ا

% على 4.3% و4.9 لتصبحإلى خفض توقعاتها لنمو االقتصاد القطري ومعهد التمويل الدوليالدولي

يرادات الغاز والصناعات بالنظر إلى تراجع إ 2016التوالي )نمو الناتج المحلي اإلجمالي الحقيقي( للعام

المرتبطة به وخفض اإلنفاق الحكومي.

بناًء على نموذج مؤلف من البورصة القطريةمدى جاذبية رة القادمة، فقد وضعنا تقييًما لأما على صعيد الفت

أربعة عوامل.

إيجابية: نظرة القيمة السوقية

ضعًفا. ويجري التداول حالًيا في 11.1إلى % ليصل اليوم 25انخفض مكرر الربحية للسوق القطرية بنسبة

. كما انحسر اهتمام ةوالكويتي ةبالسوقين السعودي نسبًيا مقارنةً ةمن القيمة السوقية الفعلي بأقل ةالسوق القطري

بسبب سوء األوضاع العالمية. وتمتاز قطر أيًضا بمعدل 2014المستثمرين في السوق في فترة ما بعد العام

شركات االتصاالت وكان مؤشرا .هو األعلى في المنطقة ،%5.1رباح الموزعة بنسبة للعوائد من األ

% على التوالي.21.1-% و33.6-والشركات الصناعية األسوأ تأثًرا، حيث تراجعا بنسبة

حيادية: نظرة األرباح

المتوقع أن تشهد أرباح . كذلك من 2016ح الشركات سلبًيا بنسبة طفيفة في العام اإننا نتوقع أن يكون نمو أرب

الشركات انخفاًضا بسيًطا مع وصول اإلنفاق على البنية التحتية إلى ذروته. ومن جهة أخرى، من المتوقع أن

% على التوالي. 15-% و10-يكون قطاعي العقار والسلع األسوأ تأثًرا وأن تتراجع األرباح فيهما بنسبة

قطاع السلع. وإلى جانب ذلك، شهدت الشركات العقارية في ويمكن أن يؤثر تراجع أسعار النفط والغاز على

2016، ويمكن أن يستمر هذا التصحيح في العام 2015قطر تصحيًحا حاًدا في النصف الثاني من العام

أيًضا. كذلك من غير المتوقع أن ترتفع أرباح قطاع االتصاالت بسبب التراجع في متوسط اإليرادات لكل

ألسواق. ولذلك فإن نظرتنا ألرباح الشركات في قطر حيادية.مستخدم ونتيجة لنضج ا

2016 يناير

وصف الدراسة:

2015في العام القطرية البورصةأداء تحليل وفًقا لنموذج 2016ووضع توقعات مستقبلية للعام

رباعي العوامل.

على المركز وأبحاثيمكن االطالع على دراسات Bloomberg-Type “MRKZ” <Go>

Thomson Research, Reuters Knowledge

Nooz Zawya Investor

ISI Emerging Markets Capital IQ

FactSet Research Connect TheMarkets.com

M.R. Raghuراجو ر.م.

، مدير مخاطر مالية معتمدمعتمدمحلل مالي األبحاثدارة الدراسات ومدير إ

8280 2224 965+ [email protected]

N.C. Karthik Rameshش ن.ك. كارثيك رام

واألبحاثالدراسات -مدير 4611+ تحويلة: 965 2224 8000

[email protected]

Rakesh Khanna راكيش خانا

محلل 4612+ تحويلة: 965 2224 8000

[email protected]

. "المركز"عالمركز المالي الكويتي ش.م.ك.

13095، الصفاة 23444ص.ب الكويت + 965 2224 8000هاتف: +965 2242 5828: فاكس

markaz.com



kuwait financial centre “markaz” - amazon web...

Documents