Qatar: Weekly Market Report

Transcription

1. ` QSE Index and Volume Regional Indices Qatar (QSE)* Dubai Abu Dhabi Saudi Arabia# Kuwait Oman Bahrain Close WTD% MTD% YTD% 8,893.27 3,325.62 4,599.47 7,417.17 6,654.55 5,006.62 1,333.02 (3.4) (2.5) (0.3) (3.1) (0.5) (0.6) (1.8) (3.4) (2.0) (0.1) (3.0) (0.5) 0.1 (1.3) 4.3 (1.3) 4.6 2.6 3.8 (1.8) 0.1 8,837.65 7,000,000 8,651.48 8,450 0 4-Feb 5-Feb 6-Feb 7-Feb Volume Market Indicators Value Traded (QR mn) Exch. Market Cap. (QR mn) QSE Index Week ended Feb 08 , 2018 1,286.1 Week ended Feb 01 , 2018 969.0 477,766.7 501,803.6 (4.8) Volume (mn) Number of Transactions Chg. % 32.7 51.8 37.3 38.9 22,273 16,903 31.8 44 43 2.3 7:36 11:32 – Companies Traded Market Breadth Market Indices Total Return ALL Share Index Banks and Financial Services Industrials Transportation Real Estate Insurance Telecoms Consumer Goods & Services Al Rayan Islamic Index Market Indices Weekly Index Performance 8-Feb Close 14,913.49 2,467.54 2,764.21 2,707.39 1,914.36 1,773.40 3,126.33 1,026.21 5,413.39 3,561.06 WTD% (3.4) (4.8) (2.9) (4.4) (5.0) (9.9) (7.8) (6.6) (0.6) (2.1) MTD% (3.4) (4.8) (2.5) (4.8) (4.2) (10.6) (7.9) (6.4) (0.2) (1.9) YTD% 4.3 0.6 3.1 3.3 8.3 (7.4) (10.2) (6.6) 9.1 4.1 0.0% (0.3%) (0.5%) (0.6%) (2.0%) (1.8%) (3.0%) (2.5%) (3.1%) (4.0%) Weekly Exchange Traded Value ($ mn) 420.37 430.15 181.93 5,692.22 231.35 51.29 30.55 Exchange Mkt. Cap. ($ mn) 131,194.7 108,557.8# 128,245.5 464,593.7 93,832.5 13,954.0 20,750.6 TTM P/E** 14.6 22.1 11.8 17.1 15.5 11.9 7.7 (3.4%) Qatar (QSE)* (1.0%) Saudi Arabia Foreign institutions turned bullish with net buying of QR49.5mn vs. net selling of QR93.0mn in the prior week. Qatari institutions turned bearish with net selling of QR49.3mn vs. net buying of QR39.4mn in the week before. Foreign retail investors remained bullish with net buying of QR2.1mn vs. net buying of QR7.1mn in the prior week. Qatari retail investors turned bearish with net selling of QR2.4mn vs. buying of QR46.5mn the week before. Foreign institutions bought (on a net basis) ~$43.1mn worth of Qatari equities since the beginning of 2018. 8,893.27 8,725 Dubai Trading volume increased by 38.9% to reach 51.8mn shares versus 37.3mn shares in the prior week. The number of transactions increased by 31.8% to reach 22,273 transactions versus 16,903 transactions in the prior week. The Banks and Financial Services sector led the trading volume, accounting for 35.6%, followed by the Real Estate sector which accounted for 21.7% of the overall trading volume. Qatar First Bank (QFBQ) was the top volume traded stock during the week with 7.5mn shares. 8,887.74 Bahrain Trading value during the week increased by 32.7% to reach QR1.3bn versus QR969.0bn in the prior week. The Banks and Financial Services sector led the trading value during the week, accounting for 43.0% of the total trading value. The Industrials sector was the second biggest contributor to the overall trading value, accounting for 17.8% of the total trading value. QNBK was the top value traded stock during the week with total traded value of QR126.2mn. 14,000,000 8,959.30 Oman Industries Qatar (IQCD), QNB Group (QNBK) and Ooredoo (ORDS) were the primary contributors to the weekly index decline. IQCD was the biggest contributor to the index’s weekly decline, deleting 78.98 points from the index. QNBK was the second biggest contributor to the mentioned decline, deleting 78.70 points from the index. Moreover, ORDS shaved off 53.74 points from the index. However, Qatar Islamic Bank (QIBK) added 22.01 points to the index. 9,000 Kuwait The Qatar Stock Exchange (QSE) Index declined 313.74 points or 3.41% during the trading week to close at 8,893.27. Market capitalization fell by 4.79% to QR477.8 billion (bn) versus QR501.8bn at the end of the previous trading week. Of the 45 listed companies, 7 companies ended the week higher, while 36 declined and 2 companies remained unchanged. Qatar National Cement Co. (QNCD) was the best performing stock for the week with a gain of 2.9% on 121.1k shares traded. On the other hand, Ezdan Holding (ERES) was the worst performing stock for the week with a decline of 14.8% on 2.4 million (mn) shares traded. Abu Dhabi Market Review and Outlook P/B** Dividend Yield 1.3 1.2 1.3 1.7 1.1 1.0 0.8 4.3 5.3 4.4 3.3 5.2 5.2 5.9 # Source: Bloomberg, country exchanges and Zawya (** Trailing Twelve Months; * Value traded ($ mn) do not include special trades, if any; Data as of February 7, 2018) Page 1 of 6
2. News Economic & Corporate News  GISS reports QR62.8mn net profit in 4Q2017 and eliminates the cash dividend for 2017; maintain Market Perform rating – Gulf International Services (GISS) reported a net profit of QR62.8mn in 4Q2017 as compared to QR6.4mn in 3Q2017, versus our estimate of QR52.32mn. EPS increased to QR0.46 in FY2017 from QR0.36 in FY2016. Revenue for the 4Q2017 came in at QR609.9mn vs our estimate of QR697.6mn, the divergence due to weaker-than-expected insurance and catering segments. GISS’ board of directors recommended no dividend for the period. According to the company, the aviation and drilling segments’ revenue remained flat vs. 2016. The catering segment’s revenue was impacted by the demobilization of major contracts. General downturn in medical and general insurance business and rate reduction affected the insurance segment. GISS stated its cash position stood at QR0.9bn across all group companies as of December 31, 2017. The company stated it is in the process of executing a series of initiatives to better utilize its asset base and to decrease its operating costs across the group companies. These initiatives include identification and short listing of a number of new opportunities, and further rationalization of the costs together with optimizing the utilization of operating assets and the supply chain. GISS stated, “The board of directors, after taking the current and future operating, investing, and financing needs of the business, believes that a dividend payment in 2017 will add further burden to the group’s liquidity position, and will place many bottlenecks for future strategic development. As such, the board of directors has recommended no dividend for 2017 and will instead use the funds for investment opportunities identified in the company’s growth strategy; where GISS will deploy the retained funds to invest in the group’s activities, capturing the growing demand locally and internationally.” Our initial take is results were not surprising given market conditions and were generally in line with our model. We welcome the dividend cut and agree with management it is a prudent move given the company’s debt load and medium-term repayments. However, the stock could come under pressure due to the elimination of the dividend. We rate GISS a Market Perform. (QNBFS Research, QSE, GulfTimes.com)  First look: UDCD’s 4Q2017 bottom line missed (despite beating on the top line) on higher-than-expected cost of revenue – UDCD’s 4Q2017 results missed our estimates as adj. EPS came in at QR0.31 vs. our estimate of QR0.50. The company beat on the top line with revenue of ~QR489mn (+21% vs. our estimate of ~QR404mn) likely on more robust land sales that we anticipated. However, overall weakness in real estate market in Qatar can be seen in gross margin compression as cost of sales was higher than we expected. Gross profit missed our ~QR249mn estimate by ~QR53mn or ~QR0.15, which explains the majority of the miss. The remainder was a result of minor items. Note that our adj. EPS excludes certain line items such as impairments and changes in fair values. Reported EPS for the quarter came in at QR0.29. Overall, we are encouraged by the beat on top line and highlight better G&A management vs. a year ago (down 14% y/y). We note that sales/marketing expenses in 2017 increased to ~QR81mn vs. ~QR71mn one year ago, which highlights, in our view, management’s emphasis on driving higher footfall on the Pearl and even improve occupancy rates. We are also encouraged with UDCD’s CEO highlighting that recurring revenue has remained stable y/y despite the current macro challenges. We believe that in part this was achieved by higher revenue at Qatar Cool which likely offset real estate weakness. Overall, we would retain our Accumulate recommendation and QR20.00 TP for the time being. (QNBFS Research, QSE, Gulf-Times.com)  QIBK sells its full stake of 60% in the Asian Finance Bank (AFB) – Qatar Islamic Bank (QIBK) executed the sale agreement with Malaysia Building Society (MBSB) to sell its full stake of 60% in the Asian Finance Bank, an affiliate in Malaysia. The sale agreement was signed on November 4, 2017 and executed on February 7, 2018 with QIBK receiving cash proceeds of MYR357.2mn from the sale of its stake. The sale shall have no material impact on bank’s financial performance at the time of exit or in future. It is worth mentioning that QIBK’s decision to exit was formulated more than two years ago until an acceptable offer to QIBK’s board was submitted. QIBK decision to exit from investment in this affiliate was driven by being no longer in line with QIBK’s business strategy together with low returns on Investment. (QSE)  QNB Group announces successful closing of $3.5bn loan facility – QNB Group announced the successful closing of the syndication for its $3.5bn three-year senior unsecured term loan facility. The syndication was well supported by 21 International Banks and the facility was upsized due to strong demand from the market. The new loan Facility will be used for general corporate purposes. The syndication was fully underwritten by nine Underwriters, including Bank of America Merrill Lynch International Limited (BAML), The Bank of Tokyo-Mitsubishi UFJ Ltd., Barclays Bank PLC, Deutsche Bank AG-London Branch, Intesa Sanpaolo S.P.A.-QFC Branch, Mizuho Bank Ltd. (Mizuho), Standard Chartered Bank, Sumitomo Mitsui Banking Corporation and United Overseas Bank Limited. BAML was mandated as the Documentation coordinator while Mizuho was mandated as the Syndication coordinator and Facility Agent. QNB Group also announced that it had already repaid in full the earlier loan of $3.0bn syndicated loan prior to issuing the above mentioned new loan facility. (Peninsula Qatar)  GWCS: Occupancy of Bu Sulba Warehousing Park rises above 70% – The Bu Sulba Warehousing Park is more than 70% occupied just in one year of its opening in January last year, according to Gulf Warehousing Company’s (GWCS) Corporate Communications Manager, Mohammad Daoud. Daoud said that this high level of occupancy within a year of its opening showed the growing demand for warehouses in the country. The warehouses are mainly occupied by small and mediumsized enterprises, Daoud said, adding that the rest of the warehouses are expected to be occupied soon. (Qatar Tribune) Page 2 of 6
3. Qatar Stock Exchange Top Gainers Top Decliners 0 .0% 6.0% -6.0% 4.0% 2.9% 2.7% 2.6% -12.0% 1.8% 2.0% -9.6% -10.1% -10.6% -10.5% Gulf International Services Qatar Insurance -14.8% 0.3% -18.0% 0.0% Qatar National Cement Qatar Islamic Bank Medicare Group Doha Bank Ezdan Real Estate Zad Holding Salam International Investment Al Khaliji Source: Qatar Stock Exchange (QSE) Source: Qatar Stock Exchange (QSE) Most Active Shares by Value (QR Million) Most Active Shares by Volume (Million) 150.0 9.0 126.2 112.6 7.5 111.4 100.0 93.2 6.0 5.6 79.1 4.6 3.8 50.0 0.0 0.0 QNB Group Qatar Islamic Bank Masraf Al Rayan United Development Investor Trading Percentage to Total Value Traded 80% 60% 27.35% 14.29% Barwa Real Estate Qatar First Bank Vodafone Qatar Salam International Investment Investment Holding group Net Traded Value by Nationality (QR Million) 52 23.50% Non-Qatari 484 14.12% 17.90% 21.73% 40.46% 40.64% 536 40% 20% United Development Source: Qatar Stock Exchange (QSE) Source: Qatar Stock Exchange (QSE) 100% 3.0 3.0 (52) Qatari 802 751 0% Buy Sell Qatari Individuals Qatari Institutions Non-Qatari Individuals Non-Qatari Institutions Source: Qatar Stock Exchange (QSE) (200) - 200 Net Investment 400 Total Sold 600 800 1,000 Total Bought Source: Qatar Stock Exchange (QSE) Page 3 of 6
4. TECHNICAL ANALYSIS OF THE QSE INDEX Source : Bloomberg Throughout last week, the Index lost 7% from the week before, but it managed to reduce much of its losses and closed down 3.41% from the week, settling at 8,893.27 on Thursday. The strength we have seen mid-to-end of last week may continue through the coming weeks. The traded volumes of the Index’s constituents were lower; drops on lower volumes are corrective in nature. The current support level remains at 8,000 points and the resistance at 10,000. DEFINITIONS OF KEY TERMS USED IN TECHNICAL ANALYSIS RSI (Relative Strength Index) indicator – RSI is a momentum oscillator that measures the speed and change of price movements. The RSI oscillates between 0 to 100. The index is deemed to be overbought once the RSI approaches the 70 level, indicating that a correction is likely. On the other hand, if the RSI approaches 30, it is an indication that the index may be getting oversold and therefore likely to bounce back. MACD (Moving Average Convergence Divergence) indicator – The indicator consists of the MACD line and a signal line. The divergence or the convergence of the MACD line with the signal line indicates the strength in the momentum during the uptrend or downtrend, as the case may be. When the MACD crosses the signal line from below and trades above it, it gives a positive indication. The reverse is the situation for a bearish trend. Candlestick chart – A candlestick chart is a price chart that displays the high, low, open, and close for a security. The ‘body’ of the chart is portion between the open and close price, while the high and low intraday movements form the ‘shadow’. The candlestick may represent any time frame. We use a one-day candlestick chart (every candlestick represents one trading day) in our analysis. Doji candlestick pattern – A Doji candlestick is formed when a security's open and close are practically equal. The pattern indicates indecisiveness, and based on preceding price actions and future confirmation, may indicate a bullish or bearish trend reversal. Shooting Star/Inverted Hammer candlestick patterns – These candlestick patterns have a small real body (open price and close price are near to each other), and a long upper shadow (large intraday movement on the upside). The Shooting Star is a bearish reversal pattern that forms after a rally. The Inverted Hammer looks exactly like a Shooting Star, but forms after a downtrend. Inverted Hammers represent a potential bullish trend reversal. Page 4 of 6
5. Com pany Nam e Price February 08 % Change WTD % Change YTD Market Cap. QR Million TTM P/E P/B Div. Yield Qatar National Bank 128.00 (5.67) 1.58 118,226 9.5 1.7 Qatar Islamic Bank 101.82 2.74 4.97 24,059 11.5 1.6 2.5 4.7 (3.36) 11,304 30.8 0.7 N/A 10,371 10.1 1.0 8.7 6,711 10.4 1.3 2.8 Commercial Bank of Qatar 27.93 (1.79) Doha Bank 33.45 1.83 17.37 Al Ahli Bank 33.50 0.00 (14.08) Qatar International Islamic Bank 59.98 (1.67) 9.85 9,079 10.9 1.6 6.7 Masraf Al Rayan 39.69 (1.39) 5.14 29,768 14.7 2.3 5.0 Al Khalij Commercial Bank 12.00 (9.64) (15.49) 4,320 8.7 0.7 6.3 6.47 (7.57) (0.92) 1,294 N/A 0.8 N/A Qatar First Bank National Leasing Dlala Holding Qatar & Oman Investment 9.75 (1.12) (8.96) 482 N/A 0.5 5.1 14.00 (3.45) (4.76) 398 21.3 1.7 N/A 1.27 252 27.0 0.9 6.3 170 N/A 1.2 3.3 8.00 (1.23) Islamic Holding Group Banking and Financial Services 30.00 (1.64) Zad Holding 73.22 Qatar German Co. for Medical Devices Salam International Investment (20.00) 216,435 0.29 (9.60) 958 9.2 1.1 6.1 5.90 (6.05) (8.67) 68 N/A 1.0 N/A 6.25 (10.07) (9.29) 714 N/A 0.5 12.8 2,223 27.7 2.2 2.3 133 31.6 1.0 4.7 13.66 11,533 15.4 1.7 5.5 Medicare Group 79.00 2.61 13.10 Qatar Cinema & Film Distribution 21.10 0.00 (15.60) 116.00 0.17 Qatar Fuel Widam Food Co. 70.22 (0.41) 12.35 1,264 11.7 3.7 5.0 Mannai Corp. 64.99 (2.11) 9.23 2,965 6.3 1.0 6.2 150.50 (1.63) 3.86 3,010 15.1 2.3 6.0 Al Meera Consumer Goods Consum er Goods and Services 22,868 Qatar Industrial Manufacturing 43.65 (0.80) (0.11) 2,074 10.7 1.3 6.9 Qatar National Cement 70.00 2.94 11.29 4,575 14.0 1.5 5.2 6.51 62,503 24.2 1.9 3.9 3,891 15.4 1.5 3.2 20,405 12.6 2.3 4.0 Industries Qatar 103.31 (5.82) 31.30 (6.06) 185.50 (1.33) 4.21 8.20 (3.53) (5.53) 5,166 11.3 0.7 7.3 Gulf International Services 16.98 (10.63) (4.07) 3,156 37.1 0.9 5.9 Mesaieed Petrochemical Holding 14.00 (4.44) 11.20 17,588 16.2 1.2 4.3 6.13 (0.97) 0.49 509 N/A 0.6 4.9 Qatari Investors Group Qatar Electricity and Water Aamal Invesment Holding Group Industrials (14.48) 119,867 Qatar Insurance Doha Insurance 45.66 (12.21) 12,662 29.9 1.3 2.9 13.91 0.07 (0.64) 696 16.5 0.7 4.3 Qatar General Insurance & Reinsurance 45.50 (1.09) (7.14) 3,982 61.7 0.7 3.3 Al Khaleej Takaful Insurance 12.87 (2.87) (2.79) 329 29.2 0.7 4.7 Qatar Islamic Insurance Insurance 55.00 (2.31) 0.05 825 13.0 2.4 6.4 United Development 16.74 (1.41) 16.41 5,927 11.0 0.5 7.5 Barw a Real Estate 36.49 (3.80) 14.03 14,199 10.7 0.8 6.9 Ezdan Real Estate 9.75 (14.77) (19.29) 25,862 15.0 0.9 5.1 Mazaya Qatar Real Estate Development Real Estate 7.70 (3.27) (14.44) 891 49.7 0.6 N/A 87.53 (8.70) (3.55) 28,038 14.6 1.2 4.0 6.95 (1.42) (13.34) 5,876 N/A 1.3 N/A Qatar Navigation (Milaha) 64.98 (3.73) 16.16 7,442 23.4 0.5 5.4 Gulf Warehousing Qatar Gas Transport (Nakilat) 38.80 (7.62) (11.80) 2,274 10.6 1.4 4.4 17.35 (6.17) 9,612 11.9 1.8 5.8 Ooredoo Vodafone Qatar Telecom s Transportation Qatar Exchange (10.47) 18,493 46,880 33,913 7.76 19,328 477,784 Source: Bloomberg Page 5 of 6
6. Contacts Saugata Sarkar , CFA, CAIA Shahan Keushgerian Zaid al-Nafoosi , CMT, CFTe Head of Research Senior Research Analyst Senior Research Analyst Tel: (+974) 4476 6534 Tel: (+974) 4476 6509 Tel: (+974) 4476 6535 saugata.sarkar@qnbfs.com.qa shahan.keushgerian@qnbfs.com.qa zaid.alnafoosi@qnbfs.com.qa Mohamed Abo Daff QNB Financial Services Co. W.L.L. Senior Research Analyst Contact Center: (+974) 4476 6666 Tel: (+974) 4476 6589 PO Box 24025 mohd.abodaff@qnbfs.com.qa Doha, Qatar Disclaimer and Copyright Notice: This publication has been prepared by QNB Financial Services Co. W.L.L. (“QNBFS”) a wholly-owned subsidiary of Qatar National Bank (Q.P.S.C.). QNBFS is regulated by the Qatar Financial Markets Authority and the Qatar Exchange. Qatar National Bank (Q.P.S.C.) is regulated by the Qatar Central Bank. This publication expresses the views and opinions of QNBFS at a given time only. It is not an offer, promotion or recommendation to buy or sell securities or other investments, nor is it intended to constitute legal, tax, accounting, or financial advice. QNBFS accepts no liability whatsoever for any direct or indirect losses arising from use of this report. Any investment decision should depend on the individual circumstances of the investor and be based on specifically engaged investment advice. We therefore strongly advise potential investors to seek independent professional advice before making any investment decision. Although the information in this report has been obtained from sources that QNBFS believes to be reliable, we have not independently verified such information and it may not be accurate or complete. QNBFS does not make any representations or warranties as to the accuracy and completeness of the information it may contain, and declines any liability in that respect. For reports dealing with Technical Analysis, expressed opinions and/or recommendations may be different or contrary to the opinions/recommendations of QNBFS Fundamental Research as a result of depending solely on the historical technical data (price and volume). QNBFS reserves the right to amend the views and opinions expressed in this publication at any time. It may also express viewpoints or make investment decisions that differ significantly from, or even contradict, the views and opinions included in this report. This report may not be reproduced in whole or in part without permission from QNBFS COPYRIGHT: No part of this document may be reproduced without the explicit written permission of QNBFS. Page 6 of 6