of  

or
Sign in to continue reading...

GCC Equity Market Monitor - 17 April

Majed Salah
By Majed Salah
6 years ago
GCC Equity Market Monitor - 17 April

Dinar, Islam, Shariah , Provision, Sales


Create FREE account or Login to add your comment
Comments (0)


Transcription

  1. GBCM Morning Briefing GBCM  Morning Briefing Contents GCC Equity Markets Monitor MSM Statistics and Indicators MSM Statistics and Indicators MENA, Global markets, Benchmark Indices and Currencies Performance Global Commodities and Petrochemicals Oman News MSM Market Watch Regional News Coverage g g April 17, 2017 4/17/2017
  2. GCC  ‐ Equity Market Monitor 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% ‐5.0% ‐10.0% Daily Return YTD Return MTD Return Oman Saudi UAE (DFM) UAE (ADX) Kuwait ‐ PI ‐0.4% ‐4.0% 0.0% ‐1.0% ‐2.8% 0.1% ‐1.6% ‐2.2% ‐0.8% ‐0.6% ‐1.3% 1.0% ‐0.6% 21.2% ‐0.9% Source: Respective Stock Markets, Bloomberg, GBCM Research GBCM Morning Briefing 2 Kuwait  i ‐ Wtd 0.0% 9.6% 0.8% Qatar Bahrain ‐0.2% ‐0.1% 0.4% ‐0.9% 10.2% ‐0.8%
  3. MSM  ‐ Net Buy/(Sell) Position Top 5 ‐ Turnover Market Share – Previous Day Previous Day Turnover: RO 11.248 million (c. US$ 29.2 million) Value Leaders Sector Turnover (RO) Market Share Figures In RO BUY SELL NET ACWA Power Barka Utility 7,796,760 69.3% 10 519 476 10,519,476  9 143 369 9,143,369  1,376,107 1,376,107  Al Batinah Dev & Inv Al Batinah Dev & Inv Inv Hldg Inv Hldg 687 661 687,661 6 1% 6.1% GCC 990,677  1,120,767  (130,091) Bank Sohar Banking 329,210 2.9% Arabs 105,952  139,930  (33,978) Al Madina Takaful Insurance 325,634 2.9% 2,223,074  3,435,112  (1,212,038) Inv Hldg 303,996 2.7% OMANIS OTHERS Al Anwar Hldg MSM ‐ Lead Indicators Value  Indicators ** Mkt. Cap (In RO 000s) Daily Market Performance y PER (X) P/BV (X) Dividend  Yield (%) Indices  Monitor Current Closing Previous  Daily %  MTD %  Closing Chg Chg YTD % Chg MSM 30 6,398,853  10.2 1.1 5.8% MSM 30 5,550.69 5,571.62 ‐0.38% 0.00% ‐4.01% Financial 3,352,899  8.8 0.9 5.0% Financial 8,071.56 8,073.72 ‐0.03% 3.03% 5.21% Industrial 970,009  16.3 1.4 5.1% Industrial 7,600.00 7,675.02 ‐0.98% ‐2.57% 2.60% Services 2,739,990  11.7 1.6 6.7% Services 2,824.00 2,830.92 ‐0.24% ‐2.13% ‐7.68% MSM Shariah 2,577,043  10.5 1.5 6.4% 815.38 826.99 ‐1.40% ‐3.33% ‐6.17% MSM Shariah 4/17/2017 GBCM Morning Briefing 3
  4. MENA  Markets Performance Index  Global Markets Performance Closing   % Chg MENA  Egypt Jordan Tunis  Morocco Palestine Turkey %MTD %QTD %YTD   ‐0.2 ‐1.3 1.4 ‐1.3 ‐2.7 1.3 5.0 2.4 2.4 ‐3.7 ‐1.1 15.3 0.3 0.2 ‐0.7 ‐0.5 12,967.4 ‐0.1 ‐0.2 2,221.3 ‐0.3 ‐1.3 5,619.7 ‐0.1 1.4 23,562.6 ‐0.4 ‐1.3 524.5 0.7 ‐2.7 90,063.7 0.2 1.3 MENA Benchmark (S&P/ MSCI) 120.8 ‐0.8 0.3 98.9 ‐0.8 0.2 S&P GCC LMC S&P GCC (USD) S&P GCC (40 Index) – Price Return  1,026.9 0.0 0.9 0.9 2.4 S&P GCC (40 Index) – Total Return  MSCI GCC MSCI Frontier  MSCI Frontier ex GCC MSCI Arabian Index 1,662.8 0.0 1.3 1.3 5.8 473.5 540.5 825.1 514.7 ‐0.8 ‐0.2 ‐0.3 ‐0.7 0.3 0.6 0.2 0.1 0.3 0.6 0.2 0.1 ‐0.7 8.2 9.5 ‐0.8 Index  S&P 500 Dow Jones Nasdaq Brazil 2,329.0 20,453.3 5,805.2 62,826.3 FTSE 100 CAC 40 DAX , 7,327.6 5,071.1 12,109.0 Nikkei  Hang Seng Sensex Shanghai Korea Russia 18,346.2 24,261.7 29 446 0 29,446.0 3,203.2 2,146.3 1,073.2 Closing  % Chg %MTD %QTD Index %YTD  0.0 ‐1.2 ‐1.2 4.6 MSCI World ‐Ex MSCI World  Ex USA USA 1,779.6 ‐0.1 ‐0.8 ‐0.8 5.2 MSCI Europe‐ USD 1,555.7 0.0 ‐0.9 ‐0.9 5.8 960.4 ‐0.3 0.2 0.2 11.4 Dollar Index USD Vs EURO  USD Vs Canadian Dollar  USD Vs Japanese Yen  USD Vs GBP  USD Vs Swedish Krona USD Vs Swiss Franc  USD Vs Chinese Renminbi USD Vs Hong Kong Dollar  USD Vs Indian Rupee  USD Vs Aus Dollar  USD Vs Indonesia Rupiah  USD Vs Turkish Lira Spot  USD Vs Omani Riyal  USD Vs UAE Dirham  USD Vs Saudi Riyal  USD Vs Kuwait Dinar  USD Vs Qatar Riyal  USD Vs Bahrain Dinar  Fixed Income (Bloomberg/EFFAS Bond Indices)  US 10+ Yr TR 573 7 573.7 00 0.0 21 2.1 21 2.1 41 4.1 Euro Liquid 10+ Yr TR 229.1 0.0 0.5 0.5 ‐1.0 1.0 ‐1.5 Commodity (Bloomberg)  Commodity  86.2 ‐0.1 1.0 Source: Data taken from Bloomberg GBCM Morning Briefing %YTD   ‐1.4 ‐1.0 ‐1.8 ‐3.3 ‐1.4 ‐1.0 ‐1.8 ‐3.3 4.0 3.5 7.8 4.3 ‐0.3 ‐0.6 ‐0.4 0.1 ‐1.0 ‐1.7 0.1 ‐1.0 ‐1.7 2.6 4.3 5.5 0.1 ‐0.2 ‐0 0.1 1 ‐1.3 0.5 ‐1.5 ‐3.0 0.6 ‐0 0.6 6 ‐0.6 ‐0.6 ‐3.6 ‐3.0 0.6 ‐0 0.6 6 ‐0.6 ‐0.6 ‐3.6 ‐4.0 10.3 10 6 10.6 3.2 5.9 ‐6.9 %QTD %YTD %YTD  0.0 ‐0.3 0.1 2.9 ‐0.1 ‐0.7 ‐0.2 0.0 0.0 0.8 ‐0.6 0.5 ‐0.1 0.0 0.0 0.0 0.0 0.0 0.0 ‐1.8 1.0 1.1 8.0 1.6 0.8 1.4 0.8 ‐0.2 5.6 5.3 1.6 ‐3.2 0.0 0.0 0.0 0.3 0.0 0.0 Global Currencies 1,832.3 MSCI EM Index %QTD Asia Pacific Global Equity (MSCI) MSCI World – USD ‐0.7 ‐0.7 ‐0.5 ‐1.7 %MTD Europe Global Benchmark Indices Index Closing   % Chg Americas  4 Closing Closing  % Chg % Chg %MTD In Comparison with USD 100.400 1.062 1.330 108.260 1.254 9.034 1.005 6.889 7.773 64.325 0.759 13259.000 3.638 0.385 3.673 3.750 0.305 3.641 0.377 ‐0.1 0.0 0.2 0.4 0.1 0.1 0.1 ‐0.1 0.0 0.1 0.1 0.1 1.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 ‐0.3 0.1 2.9 ‐0.1 ‐0.7 ‐0.2 0.0 0.0 0.8 ‐0.6 0.5 ‐0.1 0.0 0.0 0.0 0.0 0.0 0.0
  5. Commodities  Performance Index  Petrochemical Performance Closing   % Chg %MTD %QTD %YTD  Energy  NYMEX Crude 52.7 ‐0.8 4.2 4.2 ‐5.9 ICE Brent Crude 55.4 ‐0.8 3.6 3.6 ‐5.1 Crude Oil, Oman  54.7 0.1 5.5 5.5 0.9 NYMEX Natural Gas  3.2 ‐0.9 0.3 0.3 ‐9.7 172.3 ‐0.7 1.2 1.2 ‐7.8 NYMEX Gasoline  Precious Metals Gold Spot  1,292.1 0.5 3.4 3.4 12.1 Silver Spot 18.6 0.3 1.8 1.8 16.9 Platinum Spot  976.7 0.4 2.7 2.7 8.1 Palladium Spot  794.7 ‐0.2 ‐0.4 ‐0.4 16.2 Base Metals  LME Aluminium‐Spot 1 895 0 1,895.0 06 0.6 ‐2.9 29 ‐2.9 29 11 2 11.2 LME Copper‐Spot 5,660.0 1.0 ‐2.7 ‐2.7 2.5 LME Zinc‐Spot 2,610.5 0.8 ‐5.1 ‐5.1 2.1 LME Lead‐Spot 2,239.8 ‐0.3 ‐3.9 ‐3.9 12.0 LME Nickel‐Spot 9 695 3 9,695.3 02 0.2 ‐2.7 27 ‐2.7 27 ‐2.7 27 Steel  US ‐ Hot Roll Coil Steel  655.0 0.0 4.0 4.0 7.4 Agriculture  C Corn ‐ A i C Active Contract  377 0 377.0 ‐0.3 03 14 1.4 14 1.4 35 3.5 Wheat ‐ Active Contract  443.8 0.2 1.1 1.1 2.2 CBOT ‐ Soya bean  966.8 0.1 1.0 1.0 ‐5.1 Shipping  B lti D I d Baltic Dry Index  1 296 0 1,296.0 11 1.1 ‐0 1 ‐0.1 ‐0 1 ‐0.1 34 9 34.9 Index  Closing %MTD A Aromatics (in USD/ MT)  i (i USD/ MT) %QTD %YTD Benzene Aromatics Rotterdam  875.0 6.7 6.7 2.9 Benzene FOB Korea Spot 840.0 4.4 4.4 1.2 Benzene CFR Japan Spot 845.0 4.3 4.3 1.2 Benzene CFR India Spot 850.0 4.3 4.3 1.2 5.2 4.4 Condensates (in USD/ MT)  European Naptha  483.4 5.2 Naphtha C&F Japan  494.3 5.4 5.4 ‐0.5 Naphtha CIF NWE Cargo 479.1 2.2 2.2 ‐1.4 p g p p Naphtha fob Singapore Spot  53.6 5.6 5.6 ‐0.1 Olefins (in USD/ MT)  Ethylene Spot  1,165.0 ‐2.1 ‐2.1 26.0 Ethylene FOB Korea Spot 1,125.0 2.7 2.7 1.8 Ethylene FOB Japan Spot 1,120.0 2.8 2.8 1.8 820 0 820.0 ‐1.8 18 ‐1.8 18 ‐5.2 52 Propylene FOB Korea Spot Propylene FOB Korea Spot Intermediate (in USD/ MT)  2EH CFR Far East Asia 1,015.0 ‐1.5 ‐1.5 16.7 2EH CFR South East Asia 1,035.0 ‐1.4 ‐1.4 16.3 960.0 ‐0.5 ‐0.5 ‐2.5 DOP CFR Far East Asia Polymers (in USD/ MT)  LLDPE Future Contract (CNY/ MT)  8,845.0 ‐3.3 ‐3.3 ‐9.4 Film Grd Poly HDPE Far E Spot 1,150.0 0.9 0.9 ‐1.7 Film Grd Poly HDPE SE Asia 1,160.0 0.0 0.0 ‐0.9 y p Film Grd Poly HDPE India Spot 1,170.0 , 0.0 0.0 3.5 Urea (in USD/ MT)  Urea Price (RMB/ MT)  1,600.0 ‐3.6 ‐3.6 3.2 UREA Cornbelt 245.0 ‐2.0 ‐2.0 ‐10.9 UREA Middle East 221.0 4.3 4.3 ‐9.8 US Urea Avg Retail Price US Urea Avg. Retail Price 364 9 364.9 ‐1.5 15 ‐1.5 15 57 5.7 Source: Data taken from Bloomberg 4/17/2017 GBCM Morning Briefing 5
  6. Oman News Oman Banking Sector Data ‐ Feb 2017 Key Banking Sector Parameters – End Feb 2017 (Source: CBO, GBCM Research) % YoY % YTD % MoM Total Credit‐ Conventional Total Islamic Financing  Combined‐ Total Credit & Islamic Fin. Feb 2017 Addition ‐ In absolute  terms Increase of RO 69 million  Increase of RO 78 million Increase of RO 147 million 5.1% 37.8% 8.1% ‐0.3% 5.2% 0.3% 0.4% 3.1% 0.7% Total Private Sector Credit‐ Conventional Total Islamic Financing‐ Private Sector  Combined‐ Total Private Sector Credit & Islamic  Increase of RO 45 million Increase of RO 77 million Increase of RO 122 million 7.4% 29.5% 9.5% 1.3% 5.6% 1.8% 0.3% 3.5% 0.6% Total Assets‐ Conventional Total Assets‐ Islamic Financing  Combined‐ Total Assets Increase of RO 23 million Increase of RO 76 million Increase of RO 135 million 0.7% 34.6% ‐0.9% ‐4.0% 6.2% 1.3% 0.1% 2.4% 0.4% Total Deposits‐ Conventional Total Deposits‐ Shariah Combined‐ Total Deposits  Increase of RO 71 million Increase of RO 84 million Increase of RO 155 million 3.7% 45.5% 7.1% 1.3% 6.4% 1.8% 0.4% 3.8% 0.7% Total Govt. Deposits‐ Conventional Total Govt. Deposits‐ Shariah Combined‐ Total Govt. Deposits  Decrease of RO 44 million Decrease of RO 11 million Decrease of RO 55 million  5.4% 75.5% 13.0% ‐0.2% ‐3.3% ‐0.7% ‐0.9% ‐1.1% ‐0.9% Money Supply (M1) Money Supply (M2) Increase of RO 22 million Increase of RO 390 million ‐3.8% 3.9% 0.4% 2.5% 0.8% 1.5% General Provisioning‐ Conventional General Provisioning‐ Shariah Combined‐ General Provisioning Increase of RO 0.2 million Increase of RO 0.5 million Increase of RO 0.7 million 5.9% 27.2% 7.9% ‐0.3% 2.9% 0.0% 0.1% 1.6% 0.2% Specific Provisioning‐ Conventional Specific Provisioning‐ Shariah Combined‐ Specific Provisioning Increase of RO 5.3 million Increase of RO 0.7 million Increase of RO 6.0 million 6.7% 51.5% 7.0% 3.5% 2.0% 3.5% 1.2% 13.6% 1.3% GBCM Morning Briefing 6
  7. Oman News Oman Banking Sector Data ‐ Feb 2017 (Source: CBO, GBCM Research) Key takeaways  End Feb 2017, total conventional banking assets has declined ‐4% YoY and the same has increased 0.1% MoM. Conventional bank total credit increased 0.4% MoM, while the deposits grew by similar 0.4% MoM.  In terms of Money supply, M1 declined ‐3.8% YoY and increased 0.8% MoM; While M2 increased by 3.9% YoY and +1.5% MoM.  End Feb 2017, the Conventional banks credit to deposit ratio improved to 106.3% levels as compared to 107.9% levels as at end of 2016, While the total demand deposits increased to c. 30% of the total private sector deposits in the conventional banks as compared to 29.5% at end 2016.  While, the provisions and reserve interest to total credit increased to 3.5% levels similar levels were seen since 2015. We haven’t seen much deterioration in asset quality during 2015/2016, while lately we saw increase in the specific provisioning of the banks.  The total demand deposits (conventional banks) increased by 3.3% YTD till end of Feb 2017, while the savings deposits also increased by 2.2% YTD and the higher cost time deposits increased by 0.5% YTD.  We saw addition in low cost demand deposits during the first two months of the current fiscal year.  The growth in the Oman Islamic banking segment continued to remain strong during 2017 with the Islamic financing assets increasing 38% YoY (on low base) and Shariah Deposits revealing growth of 30% YoY. The Islamic financing to Shariah deposits ratio for the Islamic Banks and windows is c. 106.8% levels (end Feb 2017).  End Feb 2017, The combined credit to deposit ratio (Conventional + Islamic banks and windows) improved to 106.8% levels as against 108.4% levels seen at end 2016, revealing slightly improved liquidity scenario.  The banks are also looking at diversifying the funding base to support the growth opportunities. GBCM Morning Briefing 7
  8. Oman News Oman Banking Sector Data ‐ Feb 2017 (Source: CBO, GBCM Research) Key takeaways  The funding costs increased marginally during the period, the Rial Omani (RO) time deposits rate stood at 3.533% levels (end Feb 2017),  revealing an increase of 0.144% during the month. While the RO deposit costs increased to 1.587% levels (end Feb 2017), an increase of  0 09 % 0.094% YTD.   The RO lending rates increased to 5.122% levels (end Feb 2017), increase of 0.038% YTD, relatively lower level of increase as against the  increase in funding costs.  This points out to the margin pressure prevailing among the local banks.   p g g Spread for the banks declined 0.056% YTD to 3.535% levels. Added, the overnight domestic inter‐bank lending rate lowered to 0.430%  levels in Feb 2017 as against 0.47% in Dec 2016.  In terms of provisioning, we have seen higher specific provisions during Jan and Feb 2017 amid economic slowdown. As per the CBO data,  the combined specific provision (Conventional and Islamic Banks and windows) increased 7.0% YoY and 1.3% MoM. We would remain  cautious about increase in NPLs during the current fiscal year.  As per the CBO monthly report, in terms of Oman’s Public Finance, the total fiscal deficit (end Feb 2017) is at c. RO 1 billion amid lower  revenues reported and similar level of expenses. The fiscal deficit numbers remain higher as compared to our estimates. GBCM Morning Briefing 8
  9. Oman News Average rents decline 10 % in Muscat in 2016 (Source: Oman Observer)  Challenging market conditions have led to flexible, innovative and revised approaches from landlords across the capital in an effort to entice prospective tenants, according to leading international real estate consultancy, Cluttons.  The Cluttons Property Market Outlook has identified an increasing flexibility of finance terms, along with focus on best‐in‐class property management services, as landlords work to ensure high occupancy rates at a time of weaker demand across the real estate market.  Subdued economic activity across the Sultanate has also led to increased opportunity for tenants in the office market, as declining rental rates has led to office consolidation and migration to more affordable stock.  p shows that duringg 2016,, average g rents across Muscat receded byy 10.1%,, in line with the forecasts of p previous reports. p Duringg Latest report the final quarter of last year, rents declined by 4.2%, leaving average monthly rents just shy of RO 700.  2017 has begun on a more stable start, with rents during the three months to the end of March declining, on average, by a marginal 0.6 per cent. The limited movement has improved the year on year change to ‐7.0 per cent; the best annual performance in 18 months, suggesting some locations may be starting to show signs of bottoming out. Asaffa Foods reports Q1 2017 results (PAT‐Below our estimates) (Source: MSM)  The group revenue of the company for Q1 2017 declined moderately by 11% YoY to RO 6.781 million and a decline of 11.9% QoQ. This is in below our estimates of RO 7.500 million.  The company reported a Net profit of RO 687k a significant decline of 49% YoY and a increase of 43.4% QoQ. This is in below our estimates of RO 1.250 million.  With the fall in their respective currencies both Brazil and Turkey has been witnessing high competitive advantage in the export markets which have lead to pricing pressure for local producers like Asaffa that reflected in Q1 17 sales.  In addition to the above higher operating costs on the back of higher water & electricity costs, fuels costs, and personnel costs should have put further pressure on the margins GBCM Morning Briefing 9
  10. Oman News Raysut Cement reports Q1 2017 results (PAT‐Below our estimates) (Source: MSM)  The company has reported total revenue of RO 19.426 million for Q1 2017, a decline of 23% YoY and ‐12% QoQ. The breakup of revenue is not disclosed in its preliminary results. We believe this could be on the back of lower sales volume in local/ export markets and also due to pressure on its realization levels. This is lower than our estimates.  Q1 2017 cost of sales declined by 12.6% YoY (as compared to sales decline of 23%) and 9.3% QoQ which resulted in drop in the gross profit by 38.7% to RO 6.291 million YoY. The gross profit (GP) margins too narrowed to 32.3% levels in Q1 17 from 40% levels in Q1 16 and 34.3% in Q4 2016. We have also estimated lower margins on the increase in electricity tariff (dynamic pricing mechanism) in our model.  Financial expenses has declined 43% YoY to RO 56K, the company continued to deleverage its balance sheet and also remaining cash rich.  The impact of Deferred Tax Liability following the recent increase in corporate income tax rate from 12% to 15% has resulted in increase in tax expense to an extent of RO 1.467 million which further derailed earnings during Q1 2017.  For the period under review, the company reported Net profit of RO 3.090 million, a decline of 62.5% YoY and ‐24% QoQ. This is below our estimates. Excluding the additional deferred tax impact of RO 0.8 million, the company would have reported net profit of c. RO 4 million which is more similar to Q4 2016 profits. Al Maha Petro reports Q1 2017 results (PAT‐Below our estimates) (Source: MSM)  The company has reported a revenue of RO 101.056 million a substantial increase of 20% YoY. This is in line with our estimates of RO 105 million. We believe the increase in the sales is on the back of increase in the retail selling price of petrol and diesel.  The Cost of sales and operating expenses for Q1 17 surged by 21.0% YoY to RO 99.781 million.  The company reported a Net profit of RO 1.693 million a significant decline of 17% YoY. This is below our estimates of RO 2.350 million. Despite higher sales we believe a substantial increase in the Cost of sales and operating expenses had weighed on the earnings. GBCM Morning Briefing 10
  11. MSM ‐ Market Watch Source: Bloomberg, GBCM Research Market Outlook – Risk aversion trend to prevail, MSM to find support closer to 5,530 levels … During the last trading session, all the regional markets ended in red amid increase in geopolitical tensions and also the selling pressure seen along with the ongoing earnings season. We saw risk aversion trend in most of the GCC markets, while the investor participation also remained dull. Oman ended lower by 0.4% for the day with the sell‐off seen in certain index heavyweights post weak Q1 earnings. We saw a block deal in ACWA Power yesterday which formed c. 69% of total turnover. We expect the local and the regional markets to open in red on increased equity risk aversion and to see stock specific reactions with the continuing corporate earnings announcements. In Oman, we do anticipate sideways movement to continue along with dull volumes. On the technical perspective MSM may see support closer to 5,530 perspective, 5 530 levels. levels GBCM Morning Briefing 11
  12. UAE  News DP World ends Fujairah port concession agreement (Source: Trade Arabia)  DP World said it has reached an agreement with the Port of Fujairah to terminate its concession agreement to operate the Emirati port.  DP World UAE Region had entered into the agreement in 2005 on a build, operate and transfer (BOT) basis to expand the Fujairah Container Terminal for container handling and transhipment, reported The National.  The termination agreement was recently signed by the managing director of DP World UAE Region, and the general manager at the Port of Fujairah, it stated. The transfer of operations from DP World to the Port of Fujairah authorities has already been completed, it added. GBCM Morning Briefing 12
  13. GCC  News Riyadh bank reports Q1 results (Source: Argaam)  Riyad Bank reported a net profit of SAR 1.047 billion for the first quarter 2017, a 10.8% YoY drop on higher operating expenses, mainly driven by higher impairment charge for credit losses.  Total operating income, however, marginally increased by 0.3% mainly due to an increase in net special commission income and gains on non trading d investments, offset ff by b a decline d l in other h operating income and d exchange h income.  Q1 net profit surged 257% compared to the previous quarter. This was attributed to a 38.7% decrease in total operating expenses, as a result of the lower impairment charge for credit losses and other general and administrative expenses. MENA power sector spend seen at $302 billion in 4 years (Source: Trade Arabia)  With Mena governments prioritising investments in the power sector to feed rapidly rising electricity demand, it is estimated the region will need to invest $302 billion in its power sector in the period 2017‐21, a report said.  Of this, $179 billion will be needed to add 138GW of generating capacity, while the rest should be invested in transmission and distribution (T&D), added the latest Apicorp Energy Research.  Electricity demand in the Mena region has been growing rapidly, driven by population growth and urbanisation, rising income levels, industrialisation, and low electricity prices.  To meet rising demand, we estimate that Mena power capacity will need to expand by an average of 7.4 per cent each year between 2017 and 2021. Governments have been accelerating their investment plans and our estimates show that 97GW of capacity additions are already in execution stage.  The GCC represents 43 per cent, or 157GW, of current Mena power‐generating capacity. Despite this large capacity, the GCC will require $81 billion for the addition of 62GW of generating capacity and another $50 billion for T&D over the next five years. GBCM Morning Briefing 13
  14. GCC  News National Bank of Kuwait reports Q1 results (Source: Reuters)  National Bank of Kuwait reported a 8.1% rise in first‐quarter net profit, the bank said in a statement. Net profit for the three months to March 31 rose to 85.4 million dinars ($280.8 million) from 78.9 million a year earlier, it said.  The bank attributed the rise in net profit to higher net interest income and income from Islamic financing as a result of strong growth in b business volumes. l GBCM Morning Briefing 14
  15. | Institutional Sales ‐ Hunaina Banatwala, (+968) 2235 0717 |Institutional Brokerage ‐ Talal Al Balushi, (+968) 2235 0725| | Equity Research ‐ Kanaga Sundar, Sundar (+968) 2235 0727 | Vijay Sridharan, Sridharan (+968) 2235 0728 | Disclaimer: This document has been prepared and issued by Gulf Baader Capital Markets SAOC ("the Company") on the basis of publicly available information, internally developed data and other sources believed to be reliable. While all care has been taken to ensure that the facts stated are accurate and the opinions given are reasonable, neither Gulf Baader Capital Markets SAOC nor any employee shall be in anyway responsible for the contents of this report. report The Company may have a position and may perform buying/selling for itself or its clients in any security mentioned in this report. This is not an offer to buy or sell the investments referred therein. 4/17/2017 GBCM Morning Briefing 15