Weekly market report (1)

of 6

Market Review and Outlook QSE Index and Volume

The Qatar Stock Exchange (QSE) Index declined by 58.76 points,

or 0.48% during the week, to close at 12,080.66. Market

capitalization fell by 0.54% to reach QR656.9 billion (bn) as compared

to QR660.5bn at the end of the previous week. Of the 43 listed

companies, 17 companies ended the week higher, while 24 fell and 2

remained unchanged. Qatar General Insurance & Reinsurance Co.

(QGRI) was the best performing stock for the week, with a gain of

15.4% on only 45,919 shares traded. On the other hand, Qatar

Industrial Manufacturing Co. (QIMD) was the worst performing stock

with a decline of 9.0% on 163,481 shares traded.

Industries Qatar (IQCD), Ooredoo (ORDS) and Nakilat (QGTS)

were the biggest contributors to the weekly index decline. IQCD

was the biggest contributor to the index’s weekly decline, contributing

28.9 points to the index’s weekly fall of 58.8 points. ORDS contributed

26.6 points to the weekly index decline. ORDS reported lackluster

results and QGTS went ex-dividend during the week. United

Development Co (UDCD) also contributed 12.5 points to the index’s

weekly decline. On the other hand, Masraf Al Rayan (MARK), Milaha

(QNNS) and Qatar International Islamic Bank (QIIK) positively

contributed toward the QSE Index. MARK added 42.8 points followed

by QNNS (13.6 points) and QIIK (5.1 points).

Trading value during the week increased by 15.8% to reach

QR1.8bn vs. QR1.5bn in the prior week. The Banks & Financial

Services sector led the trading value during the week, accounting for

29.2% of the total equity trading value. The Real Estate sector was the

second biggest contributor to the overall trading value, accounting for

25.5% of the total trading value. Barwa Real Estate Co. (BRES) was

the top value traded stock during the week with total traded value of

QR326.4mn.

Trading volume increased by 26.0% to reach 37.9mn shares vs.

30.1mn shares in the prior week. The number of transactions

increased by 20.6% to reach 23,039 transactions versus 19,102

transactions in the prior week. The Real Estate sector led the trading

volume, accounting for 34.8%, followed by the Banks & Financial

Services sector, which accounted for 24.5% of the overall trading

volume. BRES was also the top volume traded stock during the week

with total traded volume of 6.8mn shares.

Foreign institutions remained bearish during the week with net

selling of QR98.1mn vs. net selling of QR74.1mn in the prior week.

Qatari institutions remained bullish with net buying of QR104.5mn vs.

net buying of QR22.8mn the week before. Foreign retail investors

remained bearish for the week with net selling of QR50.4mn vs. net

selling of QR5.3mn in the prior week. Qatari retail investors remained

bullish with net buying of QR43.9mn vs. net buying of QR55.6mn the

week before. In 2015 YTD, foreign institutions sold (on a net basis)

~$42mn worth of Qatari equities.

Market Indicators Week ended

Mar. 12, 2015 Week ended

Mar. 05, 2015 Chg. %

Value Traded (QR mn) 1,768.4 1,527.8 15.7

Exch. Market Cap. (QR mn) 656,918.2 660,514.4 (0.5)

Volume (mn) 37.9 30.1 26.0

Number of Transactions 23,039 19,102 20.6

Companies Traded 43 43 0.0

Market Breadth 17:24 15:27 –

Market Indices Close WTD% MTD% YTD%

Total Return 18,530.56 (0.2) (1.5) 1.1

All Share Index 3,204.33 (0.1) (1.3) 1.7

Banks/Financial Svcs. 3,249.74 0.4 (1.3) 1.4

Industrials 3,977.02 (1.1) (1.7) (1.5)

Transportation 2,491.28 1.0 2.1 7.5

Real Estate 2,421.20 0.4 (1.3) 7.9

Insurance 4,183.25 2.3 1.9 5.7

Telecoms 1,367.08 (3.1) (4.0) (8.0)

Consumer 7,141.58 (0.4) (1.9) 3.4

Al Rayan Islamic Index 4,387.92 0.3 (0.9) 7.0

Market Indices Weekly Index Performance

Regional Indices Close WTD% MTD% YTD% Weekly Exchange

Traded Value ($ mn) Exchange Mkt.

Cap. ($ mn) TTM P/E** P/B** Dividend Yield

Qatar (QSE)* 12,080.66 (0.5) (2.9) (1.7) 485.60 180,455.4 14.1 1.9 3.9

Dubai 3,707.77 (1.1) (4.1) (1.8) 494.12 90,755.2 8.0 1.5 5.4

Abu Dhabi 4,483.54 (2.3) (4.3) (1.0) 312.59 125,053.8 12.1 1.5 4.0

Saudi Arabia# 9,661.91 1.5 3.7 15.9 12,411.62 559,468.3 19.5 2.3 2.7

Kuwait 6,514.34 (0.4) (1.3) (0.3) 237.98 99,315.4 17.4 1.1 3.8

Oman 6,399.76 (1.9) (2.4) 0.9 65.79 24,440.4 10.5 1.4 4.4

Bahrain 1,482.88 1.1 0.5 3.9 7.16 23,174.6 9.7 1.0 4.6

Source: Bloomberg, country exchanges and Zawya (** Trailing Twelve Months; * Value traded ($ mn) do not include special trades, if any; # Data as of March 11, 2015)

12,144.01

12,235.92

12,264.38

12,127.98

12,080.66

0

6,000,000

12,000,000

11,900

12,100

12,300

8-Mar 9-Mar 10-Mar 11-Mar 12-Mar

Volume QSE Index

1.5%1.1%

(0.4%) (0.5%)(1.1%)

(1.9%) (2.3%)(3.0%)

(1.5%)

0.0%

1.5%

3.0%

Saud

i Ara

bia

Bah

rain

Kuw

ait

Qata

r (Q

SE

)*

Dubai

Om

an

Abu D

habi

of 6

News

Economic News

MDPS: Qatar’s trade surplus totals QR73.5bn in 4Q2014 –

According to the Ministry of Development Planning & Statistics (MDPS), Qatar’s trade surplus stood at QR73.5bn in 4Q2014 as compared to QR94.7bn in 4Q2013. The value of Qatar’s total exports amounted to QR104.2bn in 4Q2014, down 13.8% from QR121.0bn registered in 4Q2013. As per MDPS, the YoY decline in total exports was mainly due to lower exports of mineral fuel, lubricants and related materials. The value of Qatar’s imports stood at QR30.7bn in 4Q2014, up 16.9% over 4Q2013. The YoY increase reflects higher imports of machinery & transport equipment. Among other major import items were manufactured goods and food & animal stock. In 4Q2014, Asia remained the principal destination for Qatar’s exports and the first origin of Qatar’s imports, representing 78.3% and 35.9% share respectively, followed by the European Union, accounting for 10% and 26.9%, and the GCC, with 6.7% and 14.7% share, respectively. (Gulf-Times.com)

Fitch upgrade confirms strength in Qatar economy – The

international credit rating agency, Fitch Ratings, has issued 'AA' ratings for Qatar's long-term foreign and local currency Issuer Default Ratings (IDRs). The outlooks are Stable. Fitch has also released the short-term foreign currency IDR at 'F1+' and a country ceiling of 'AA+'. The AA rating is the third highest possible rating offered to any country or institution. The F1+ is the highest rating that could be given to an institution or country for short-term bonds. Such upgrades to credit ratings help in attracting investment. The Minister of Finance HE Mr. Ali Shareef Al Emadi said that the upgrade of Qatar’s credit rating to AA and a stable outlook confirm the strong credit position of the country. The minister said that Fitch’s upgrade is in line with ratings given by other agencies such as Standard & Poor’s and Moody’s. (Peninsula Qatar, Reuters)

Market & Corporate News

ORDS reports 17% YoY drop in FY2014 net profit –

Ooredoo’s (ORDS) net profit in FY2014 fell by 17% YoY to QR2.1bn. Revenue for FY2014 stood at QR33.2bn, reflecting a YoY decrease 1.9%. The company reported a 11.6% YoY decline in its EBITDA to QR12.9bn in FY2014, while the EBITDA margin fell to 39% in FY2014 from 43% in FY2013. The group’s customer base increased by 12% YoY to 107mn as of December 31, 2014, driven by the Indonesian, Iraqi, Kuwaiti, Myanmar and Algerian markets. ORDS’ data revenue for FY2014 represented 25% of the group’s total revenue supported by its strategy to increase smartphone penetration, deliver innovative new bundles and data offers for customers. EPS amounted to QR6.66 in FY2014 as compared to QR8.05 in FY2013. Meanwhile, ORDS’ board of directors has recommended distributing a cash dividend of QR4.00 per share. (Company Press Release)

BRES’ net profit soars 102% YoY in FY2014, completes transaction with Qatari Diar – Barwa Real Estate Company’s

(BRES) net profit surged by 102% YoY to QR2.78bn in FY2014, primarily led by higher profit from sale of properties (QR2.93bn in FY2014 versus QR0.95mn in FY2013) and an increase in rental income (up 12.1% YoY to QR1.22bn). The company’s EPS for FY2014 amounted to QR7.14 versus QR3.53 in FY2013. Further, BRES’ board of directors has recommended the distribution of cash dividends of 22% (QR2.20 for each share). Meanwhile, BRES reported completion of its transaction announced on June 6 and November 17, 2013 with Qatari Diar, which included selling BRES’ stake in Barwa Bank, Barwa Commercial Avenue,

Barwa Al Sadd, Barwa City and some other assets. BRES sold 37.34% of the total shares in Barwa Bank to Qatari Diar for QR7.63bn and 95% of the total shares in Barwa Commercial Avenue to Labregah Real Estate Company (wholly owned by Qatari Diar) for QR9.02bn in order to reduce its debts. The assets, which were not transferred to Qatari Diar, include some local and international assets in BRES’ investment portfolio, which amounted to QR1.4bn. However, the transaction recorded loss of QR239mn in the financial statements for the year ended December 2014, due to the low value of those assets and some costs associated with them. BRES will put an investment in those assets in future to increase shareholders’ returns. (QSE)

DHBK plans to launch ETF on QSE – Doha Bank (DHBK) is

planning to launch an exchange traded fund (ETF) on the Qatar Stock Exchange (QSE) with Amwal acting as the fund manager and the Group Securities as the liquidity provider. An agreement has been signed to appoint Amwal as the fund manager, as well as to get licensing for the index benchmark from QSE. DHBK’s CEO R. Seetharaman said that the Qatar Index ETF, which is pending regulatory approvals, will track the QSE Index. Once approved by the Qatar Financial Markets Authority (QFMA), the ETF would list on QSE and provide investors with exposure to the index benchmark with a single trade. He added that the Group Securities will provide bid and ask prices, as well as coordinate with the fund manager to manage the supply of ETF units on QSE. (QSE)

Kahramaa signs deal with QEWS to establish water plant –

The Qatar General Electricity & Water Corporation (Kahramaa) has signed an agreement with Qatar Electricity & Water Company (QEWS) to establish a plant for the production and desalination of water using reverse osmosis (RO) technology. The plant, the first of its kind in Qatar, will have a capacity to produce 36mn gallons of desalinated water every day. It will cost $500mn and start operations in 3Q2016. Kahramaa and QEWS have signed an offer letter to enable the latter to start work and an agreement for buying water for the next 25 years will be signed in three months. Under the agreement, QEWS will establish the plant and Mitsubishi Company will be responsible for preparing the design, importing equipment and installing the plant. (Peninsula Qatar)

QPMC’s cement silo at Mesaieed to be ready by November – Qatar Primary Materials Company’s (QPMC) Director of

Operations Navjot Singh said that the company’s 60,000-ton capacity cement silo project at Mesaieed will be operational by November 2015. He said there would be 12 silos each with 5,000 tons storage capacity. The company plans to provide cement silos at the gabbro berths to store and discharge more than 2mn tons of imported cement annually for meeting the expected increase in demand. Further, the company plans to develop gabbro quarries outside Qatar as well as provide the sea logistic supply chain. (Gulf-Times.com)

New deal inked at Qatar Projects to build housing for 12,000 workers – MEED Events said that Daruna

Development signed a QR800mn management agreement with Wasita Qatar (ISNAD), a subsidiary of Shari'ah-compliant service provider Wasita Group of Companies, during the Qatar Projects 2015 Conference. The project envisages building high-quality accommodations for 12,000 workers over the next three years. Daruna will maintain ownership of the accommodations, while Wasita will operate and manage the workers' housing including housekeeping, catering, laundry and maintenance. (Peninsula Qatar)

of 6

Qatar Stock Exchange

Top 5 Gainers Top 5 Decliners

Source: Qatar Stock Exchange (QSE)


Most Active Shares by Value (QR Million) Most Active Shares by Volume (Million)



Investor Trading Percentage to Total Value Traded Net Traded Value by Nationality (QR Million)



15.4%

12.6%

4.5%3.8% 3.8%

0.0%

6.0%

12.0%

18.0%

Qatar General Insurance & Reinsurance

Qatar Cinema & Film

Distribution

Qatar Islamic Insurance

Zad Holding Masraf Al Rayan

-9.0%

-6.8%

-5.8%

-4.8%-4.5%

-12.0%

-8.0%

-4.0%

0.0%

Qatar Industrial

Manufacturing

Dlala Holding Qatar Gas

Transport (Nakilat)

Salam

International Investment

Ooredoo

326.4

161.5

124.0113.8 107.2

0.0

120.0

240.0

360.0

Barwa Real Estate

Gulf International

Services

Commercial Bank of Qatar

Masraf Al Rayan

Industries Qatar

6.8

4.2

3.0

2.42.1

0.0

3.0

6.0

9.0

Barwa Real Estate

Vodafone Qatar Mazaya Qatar Masraf Al Rayan National Leasing

0%

20%

40%

60%

80%

100%

Buy Sell

46.75% 44.27%

22.34%16.43%

13.73%16.58%

17.17% 22.72%

Qatari Individuals Qatari Institutions

Non-Qatari Individuals Non-Qatari Institutions

1,222

546

1,073

695

148

(149)

(400) (200) - 200 400 600 800 1,000 1,200 1,400

Qatari

Non-Qatari

Net Investment Total Sold Total Bought

of 6

TECHNICAL ANALYSIS OF THE QSE INDEX

Source: Bloomberg

The QSE Index fell yet another week, accompanied by low traded volumes. It closed at the 12,080.66 level and lost 0.48% from the week before. Technical

indicators are flattening down, caused by the marginal drop experienced throughout the week. Consequently, weakness could continue further. We expect a

strong support level to be situated between the 12,000 and the 11,850 levels. The main resistance area is likely to be around the 12,350 level.

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.

of 6

Source: Bloomberg

Company Name

Price

(March 12)

% Change

5-Day

% Change

YTD

Market Cap.

QR Million TTM P/E P/B Div. Yield

Qatar National Bank 199.10 (0.50) (6.48) 139,316 13.3 2.4 3.8

Qatar Islamic Bank 100.50 (0.20) (1.66) 23,747 15.0 1.9 4.2

Commercial Bank of Qatar 69.60 (0.57) 1.61 20,667 11.0 1.2 2.4

Doha Bank 52.40 (1.13) (8.07) 13,539 10.0 1.2 7.6

Al Ahli Bank 48.95 1.14 (1.38) 8,895 14.8 2.1 2.8

Qatar International Islamic Bank 87.30 1.51 6.85 13,214 16.0 2.5 4.3

Masraf Al Rayan 46.70 3.78 5.66 35,025 17.5 3.1 3.7

Al Khaliji Bank 21.20 (2.53) (3.85) 7,632 13.5 1.3 4.7

National Leasing 21.90 3.69 9.50 1,084 25.1 0.9 3.9

Dlala Holding 41.00 (6.82) (4.21) 910 13.6 3.1 N/A

Qatar & Oman Investment 16.09 (0.19) 4.48 507 19.6 1.4 3.7

Islamic Holding Group 123.50 0.16 (0.80) 494 30.7 7.3 2.4

Banking and Financial Services 265,030

Zad Holding 94.90 3.83 12.98 1,241 11.5 1.0 3.7

Qatar German Co. for Medical Devices 10.92 (0.73) 7.59 126 N/A 0.8 N/A

Salam International Investment 13.90 (4.79) (12.30) 1,589 20.7 1.0 4.3

Medicare Group 151.00 (1.31) 29.06 4,250 23.4 4.6 1.2

Qatar Cinema & Film Distribution 47.30 12.62 7.50 270 21.9 1.9 N/A

Qatar Fuel 199.90 (0.45) (2.15) 16,883 14.9 2.5 3.8

Qatar Meat and Livestock 58.90 0.68 (2.48) 1,060 17.0 3.9 3.6

Al Meera Consumer Goods 214.00 0.23 7.00 4,280 18.9 3.0 3.7

Consumer Goods and Services 29,700

Qatar Industrial Manufacturing 45.50 (9.00) 4.96 2,162 13.4 1.4 6.6

Qatar National Cement 137.00 0.74 3.79 6,727 16.0 2.6 4.4

Industries Qatar 143.50 (1.98) (14.58) 86,818 13.7 2.6 4.9

Qatari Investors Group 42.95 (1.83) 3.74 5,340 23.6 2.4 1.7

Qatar Electricity and Water 190.90 0.42 1.81 20,999 13.3 3.1 3.9

Mannai Corp. 113.30 (1.22) 3.94 5,169 9.8 2.4 4.9

Aamal 18.40 (0.05) 21.13 11,040 19.2 1.5 N/A

Gulf International Services 93.00 (1.06) (4.22) 17,283 12.3 4.8 5.9

Mesaieed Petrochemical Holding 27.50 (0.36) -6.8 34,549 19.2 2.4 5.3

Industrials 190,086

Qatar Insurance 76.00 (1.30) (3.53) 14,031 14.0 2.5 2.9

Doha Insurance 26.50 (1.67) (8.62) 1,325 10.3 1.2 3.8

Qatar General Insurance & Reinsurance 77.90 15.41 32.03 5,389 6.1 0.9 1.6

Al Khaleej Takaful Insurance 54.00 14.36 22.24 1,199 18.6 2.1 2.4

Qatar Islamic Insurance 89.20 4.45 12.91 1,338 18.2 4.3 4.2

Insurance 23,282

United Development 23.27 (4.32) (1.36) 8,240 13.1 0.8 5.4

Barw a Real Estate 49.00 0.62 16.95 19,067 6.6 1.2 4.1

Ezdan Real Estate 15.65 0.00 4.89 41,512 30.9 1.4 2.0

Mazaya Qatar Real Estate Development 19.75 3.67 3.13 1,975 9.2 1.6 3.8

Real Estate 70,793

Qatar Telecom 108.10 (4.51) (12.75) 34,627 13.7 1.5 3.7

Vodafone Qatar 17.85 0.85 8.51 15,090 N/A 2.7 1.0

Telecoms 49,717

Qatar Navigation (Milaha) 109.30 3.70 9.85 12,518 11.9 0.9 4.6

Gulf Warehousing 57.00 0.00 1.06 2,711 19.3 3.1 2.6

Qatar Gas Transport (Nakilat) 23.36 (5.81) 1.13 13,082 14.5 3.4 5.1

Transportation 28,310

Qatar Exchange 656,918

Contacts

Saugata Sarkar Abdullah Amin, CFA Badar Husain

Head of Research Senior Research Analyst Head of Trading

Tel: (+974) 4476 6534 Tel: (+974) 4476 6569 Tel: (+974) 4476 6547

[email protected] [email protected] [email protected]

Sahbi Kasraoui Ahmed Al-Khoudary QNB Financial Services SPC

Manager – HNWI Head of Sales Trading – Institutional Contact Center: (+974) 4476 6666

Tel: (+974) 4476 6544 Tel: (+974) 4476 6548 PO Box 24025

[email protected] [email protected] Doha, Qatar

Disclaimer and Copyright Notice: This publication has been prepared by QNB Financial Services SPC (“QNBFS”) a wholly-owned subsidiary of QNB SAQ (“QNB”). QNBFS is regulated by the Qatar Financial Markets Authority and the Qatar Exchange QNB SAQ 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. of 6

Weekly market report (1)

Documents

Transcript of Weekly market report (1)