Aranca Blog

GCC markets witnessed selling pressure across counters and dropped 1-2%, failing to hold on to levels achieved after a strong rally in the previous week. Baring Saudi Arabia, all other GCC markets succumbed to profit booking this week, with Dubai (down 6.4%) cracking the most.

UAE: UAE markets saw heavy selling pressure throughout the week, with DFM and ADX plunging 6.4% and 2.7%, respectively. However, the indices ended on a positive note in the last trading session. The downtrend in the week was triggered by the banking, and real estate and construction counters, with the sectoral indices losing more than 7% each. Blue-chip losers in the week included Emirates NBD, CBI and Emaar in the DFM Exchange, and NBF and Sorouh Real Estate in the ADX.

Saudi Arabia: The Saudi market showed strength this week, buoyed by positive news flow of enhanced fiscal situation and budgetary announcements. Strong gains in petrochemical and insurance stocks enabled Tadawul Exchange to close above the 6200 mark, gaining 1.5%. Notable gainers in Saudi Arabia were Yansab (14.5%) and Tawuniya (11.2%). Sipchem’s acetyl project initiation also contributed to the rally on the indices, with the stock surging 5.57% this week.

Kuwait: Kuwait Stock Exchange witnessed marginal loss of 0.7% to close the week at 7056, with weakness in banking counters offset by modest gains in real estate stocks. Telecom major Zain lost almost 6% this week, wiping off all its previous week’s gains. Banking and finance stocks showed mixed trends, with NBK pulling back 1.8% this week, while Kuwait Finance House (KFH) added to last week’s gain by 3.5%.  

Oman: Muscat Securities Market posted a weekly loss of 1.3% to close at 6167. The banking and investments sector pulled back 4.35% from last week’s rally. Bank Muscat and Oman National Investment Corp (ONIC) failed to sustain last week’s rally and were among the most active counters dropping 4.3% and 7.4%, respectively.

Qatar: The Doha Securities markets lost 1.7% during the week to close at 7046 levels, with all sectoral indices ending lower. The banking and financial sector led the downtrend in Qatar, losing almost 2% during the week, with heavy-weights Commercial Bank of Qatar and Doha Bank down  6.2% and 2.7%, respectively. Easing inflation in Qatar and Moody’s reaffirming QNB’s Long Term rating could not bring cheers to the market as investors exhibited caution during the week.

Bahrain: The Bahrain Stock Exchange closed at 1449, ending the week on a flat note. Investments sector’s positive gains were offset by weakness in banking stocks. While Barka and Ithmar bank extended the gains by 5-6%, market heavy-weights AUB and Gulf Finance House (GFH) shed 3-3.5% this week, thereby inducing a flat closing on the broader indices. In summary, baring Saudi Arabia, most GCC markets failed to extend last week’s strong rally and saw profit booking drag indices to lower levels this week.

To read complete commentary, please download the file.

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ARANCA is a leading provider of customized end-to-end investment research, business and IP research and IRC 409A valuation services to global clients. To know more about us and our services, click here.

December 24th, 2009 | Tags: AUB and Gulf Finance House, DFM and ADX, Kuwait Finance House | Category: GCC Weekly | Leave a comment

News & Views General 

• Saudi Arabian Mining Company signed an agreement with Alcoa to build $10.8 Bn worth aluminium complex.
• Saudi Arabia based Al-Tayyar Travel Group plans to raise $320 Mn from an initial public offering. The company is eyeing 30% stake in its UK counterpart to fund its expansion.
• Fitch Ratings affirmed ratings for the Industrial Bank of Kuwait as Long-term Issuer Default ‘A+’ with ‘Stable’ outlook and downgraded the Individual Rating to ‘C/D’ from ‘C’. The downgrade in the Individual rating reflects worsening operating environment.
• Savola Group renounced to bid for six sugar mills sold by the Turkish government, citing lack of study.
• Fitch Ratings gave Saudi Basic Industries Corporation’s ratings ‘A+’ in its Long-term Issuer Default, senior unsecured ‘A+’ and Short-term IDR ‘F1′ with ‘Stable’ outlook. The rating reflects the company’s financial policy and the company’s investment programme.
• Topaz Energy and Marine today raised $42 Mn from Standard Chartered Bank, Dubai to finance its fleet expansion plans.
• Egypt took $5 Bn from international and regional financiers to fund and complete its 2007 to 2012 five-year plan aimed at enhancing energy output.
• Petroleum Development Oman awarded an engineering, construction and procurement contract to South Korea’s GS Engineering and Construction for the Saih Nihayda gas compression project.

December 19th, 2009 | Category: GCC News | Leave a comment

Most GCC markets rebounded this week as concerns pertaining to Dubai’s debt burden eased. The Abu Dhabi government extended financial support to Dubai, increasing optimism among GCC investors. Positive developments in Dubai also helped other GCC markets gain 2–5% this week.

UAE: UAE markets bounced back, with DFM and ADX gaining 14.5% and 10.8%, respectively, during the week. The rally was triggered by the real estate and construction sector, with the sector index rising 29% during the week. The banking and financial services sector also contributed to the market’s gains. Blue-chip gainers included Emaar and Almadina in the DFM Exchange, and Aldar Properties, FGB and Sorouh Real Estate in the ADX.

Saudi Arabia: The recovery in banking, petrochemical and cement stocks enabled Tadawul Exchange to close the week 3.35% higher at 6154. Notable gainers in Saudi Arabia were Riyad Bank and Saudi Arabian Mining Co. (MAADEN), which gained 11% and 7%, respectively. Maaden invited firms across the globe to re-tender bids for its USD1 bn alumina refinery. The positive response to this invitation boosted the stock. Saudi Kayan, which announced plans to start the main units of the Jubail petrochemical project in 2H 2010, gained a modest 2% during the week.

Kuwait: Kuwait Stock Exchange gained a healthy 5.1% to close the week at 7104 led by investment trusts and real estate counters. NBK and Kuwait Finance House (KFH) gained 5.5% each during the week, while telecom major Zain gained 7%. The government recently announced its long-tem development plan for the Industrial sector. Consequently, the sector index gained 4.11% this week. CBK approved BKME’s proposal to fully convert into an Islamic bank; however, this failed to cheer investors. BKME gained just 1% during the week.

Oman: Muscat Securities Market posted a weekly gain of 4.6%. The banking and investments sector led the rally in Oman, with the sector index gaining 8%. Bank Muscat and Oman National Investment Corp (ONIC) were among the notable gainers. MSM-30 index, which touched a high of 6291 during the week, was jolted by the USD39mn deficit in Oman’s budget. The index shed some gains to close the week below 6250.

Qatar: The Doha Securities markets gained 3.48% during the week with all sector indices, barring Insurance, closing higher. The banking and financial sector led the rally in Qatar, gaining 4.8% during the week. Commercial Bank of Qatar and Doha Bank rose 11% and 7.6%, respectively. The anticipated double digit economic growth and the government’s plans to invest USD900mn in banking stocks fuelled optimism among investors.

Bahrain: The Bahrain Stock Exchange closed at 1447, gaining 2.4% this week due to the strong performance by investment trusts, banks, and hotel and tourism companies. The top gainers, Gulf Finance House (GFH) and Ithmaar Bank, rose more than 14%. In summary, GCC markets recouped the previous week’s losses as concerns pertaining to Dubai’s debt burden eased. 

To read complete commentary, please download the file.

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ARANCA is a leading provider of customized end-to-end investment research, business and IP research and IRC 409A valuation services to global clients. To know more about us and our services, click here.

December 18th, 2009 | Category: GCC Weekly | Leave a comment

Aranca is one of only five partners of the Irideus.org initiative, which is slated to emerge as a standard solution for global smaller/mid-cap research coverage  

London: Tuesday, 8^th December 2009: Aranca, a leading global provider of on-demand custom investment and business research services, has joined hands with Irideus.org – the Intermediated Research Initiative – to offer independent equity research for financial institutions, companies, exchanges, and institutional/retail investors. Irideus.org is an independent platform for companies worldwide seeking research coverage, powerful distribution network and to reach out to global investors. It combines the scale and expertise of the research professionals of five leading, global independent research providers including Aranca to serve as a single repository for research on global issuers. The platform is set to emerge as a single, standard solution to serve the needs of financial institutions, companies, exchanges and investors. 

Given the fact that an estimated 25,000 public companies listed on 27 key stock exchanges around the world lack research coverage, Irideus.org could emerge as a single global solution to this key issue. With a uniform research report structure, standardized analytical frameworks, conformance to CFA Institute best practice guidelines and a strong distribution network, Irideus.org provides a compelling value proposition to the issuers, investors and exchanges. 

Hemendra Aran, CEO, Aranca said, “Aranca is delighted to be a part of Irideus.org and participate in this global initiative to provide independent equity research on a large scale. We already serve a range of buy-side and sell-side institutions across geographies and understand their needs very well. With Irideus.org, we will play our part to provide coverage to uncovered companies and help fill long-standing gap in the global independent equity research space.”
 

About Aranca:

Aranca is a global provider of end-to-end customized investment and business research, valuation services and intellectual property research services. With a unique blend of market knowledge, research expertise and flexible engagement models, Aranca provides cost-effective, world-class research services customized to client’s specifications. Established in London in 2003, Aranca has emerged as a trusted research partner for a variety of global clients. Aranca’s financial research offerings include equity research, financial modeling and valuation, technical analysis, forensic accounting, market summaries and thematic research notes. Our research solutions are backed by robust information technology infrastructure, world-class processes, experienced analysts with cross-disciplinary expertise and in-depth knowledge of several industry sectors. For more information, please visit www.aranca.com
 

About Irideus.org:

Irideus.org is a new equity research platform comprising the combined research expertise, scale and capabilities of five leading international research providers. Based on an innovative Intermediated Research model, Irideus.org addresses the drawbacks associated with the traditional forms of company-paid research. Irideus.org provides comprehensive, objective and rigorous research coverage. The research provided under the aegis of Irideus.org would be standardised and of high quality. Irideus.org has been formally launched in London on 8^th December 2009. For more information, please visit www.irideus.org

December 9th, 2009 | Tags: business research, buy-side, independent equity research, investment research, Irideus.org, sell-side | Category: News@Aranca | Leave a comment

Positive macroeconomic indicators emanating from the US reversed the previous week’s bearish undertone, encouraging investors to make purchases in major markets across the globe for the week ended October 9. The Institute for Supply Management’s index of non-manufacturing businesses, which accounts for 90 percent of the US economy, rose unexpectedly to 50.9 in September (a level above 50 indicates expansion) from 48.4 in August. Furthermore, US initial jobless claims fell by 33,000 to 521,000, the lowest level since January, for the week ended October 3. US trade deficit unexpectedly narrowed by 3.6 percent to US$30.7 billion in August from US$31.9 billion in July. Inventories at US wholesalers also dropped 1.3 percent in August after falling 1.6 percent in July. Encouraging news from the world’s largest economy generated positive sentiment among investors, triggering widespread buying across the US and Europe. Consequently, the Dow Jones Industrial Average (DJIA) gained 3.98 percent, while the FTSE 100 rose 3.47 percent for the week ended October 9.

Asian markets ended the week on a strong positive note, with six of the seven major indices closing higher due to positive global cues and a surprise increase in the interest rate in Australia. Hang Seng, Hong Kong’s benchmark index (up 5.52 percent), was the best performer in anticipation of an economic recovery. India’s benchmark BSE Sensex, the worst performer, declined 2.87 percent during the week due to concerns pertaining to overstretched valuations and massive selling of telecom stocks.

The Rupee appreciated 2.80 percent during the week as foreign institutional investors (FII) remained net buyers. Crude oil prices rose 2.6 percent to US$71.77 per barrel from US$69.95 last week. Crude oil prices rose during the week as the International Energy Agency (IEA) increased its global consumption forecast for a third month to an average of 86.1 million barrels a day next year.

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 To read complete commentary, please download the file.

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ARANCA is a leading provider of customized end-to-end investment research, business and IP research and IRC 409A valuation services to global clients. To know more about us and our services, click here

October 9th, 2009 | Tags: Dow Jones Industrial Average, foreign institutional investors, FTSE | Category: India Weekly | Leave a comment

The release of dismal employment data from the US triggered selling by disappointed investors across the globe. US Labor Department reported a loss of 263,000 jobs in September against a median estimate of 175,000 jobs. The unemployment rate climbed to 9.8 percent in September, the highest since 1983. Furthermore, orders placed with US factories unexpectedly fell 0.8 percent in August after increasing 1.4 percent in July. Negative news emanated from the Eurozone as well. Unemployment in the 16-member Eurozone climbed to 9.6 percent in August from 9.5 percent in July as companies continued to cut jobs. A slew of bad news from major economies led to widespread pessimism among investors pushing the Dow Jones Industrial Average (DJIA) and FTSE 100 down 1.84 percent each for the week ended October 2.

Asian markets ended the week on a negative note, with five of the seven major indices closing in the red for the week ended October 2, driven by negative global and regional cues. Nikkei 225, Japan’s benchmark index (down 5.2 percent), was the worst performer due to concerns over a cut in spending by major companies and a rising Yen. India’s benchmark BSE Sensex was the best performer, rising 2.65 percent during the week backed by positive economic indicators and strong liquidity inflows.

The Rupee appreciated 0.48 percent during the week as foreign institutional investors (FII) remained net buyers. Crude oil prices rose 6.0 percent to US$69.95 per barrel from US$66.02 last week. Crude Oil gave up some of its gains during the latter part of the week due to adverse macroeconomic indicators from the US signifying that the economy was still in the midst of a recession.

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 To read complete commentary, please download the file.

______________________________________________________________________________

ARANCA is a leading provider of customized end-to-end investment research, business and IP research and IRC 409A valuation services to global clients. To know more about us and our services, click here

October 2nd, 2009 | Tags: Dow Jones Industrial Average, foreign institutional investors, FTSE, US Labor Department | Category: India Weekly | Leave a comment

News & Views General

• Qatar plans to increase its stake in Volkswagen AG after the German carmaker completes its takeover of Porsche SE.
• Kuwait-based Gulf Investment House has reached an agreement with three of its six creditors to reschedule debt. Gulf Investment has paid KWD4 Mn ($13.9 Mn) out of KWD17.8 Mn in debt.
• A new joint venture company, Warehousing & Distribution Holding Company (WARED) LLC, started operation in Saudi Arabia to deliver customized and high-capacity transportation services across the Middle East and North Africa (MENA).The new joint venture, with a capital of SAR120 Mn, is owned by Zahid Holding Group and Construction Products Holding Company (CPC) on a 50:50 basis.
•  Shuaiba Industrial Company (SIC) entered in to contract to participate in the capital of Atbra Cement Company Ltd. which manufactures cement sacs, at a cost USD 11 Mn in Sudan. The SIC’s share in the suggested capital is 33%.
• Kuwait Energy Company, one of the largest independent exploration and production companies in the Middle East, has secured a $50 Mn loan from the International Finance Corporation (IFC), a member of the World Bank Group.
• Dubai-based shipping, logistics and marine services provider GAC has expanding the company’s facilities in Jebel Ali Free Zone’s south zone to more than 160,000 sq. mtr. by acquiring a 42,000 sq. mtr. warehouse.

Real Estate and Private Equity

• Abu Dhabi-based property adviser and solutions provider Tasweek Real Estate Marketing and Development has announced it plans to create a real estate investment portfolio worth $250 Mn, featuring key Dubai and Abu Dhabi projects within the next 18 months.
• Emaar MGF, a joint venture between Dubai-based Emaar Properties and India’s MGF Developments, is planning to raise up to Rs75 Bn or about $1.5 Bn through an initial public offering.

September 30th, 2009 | Tags: Atbra Cement Company, Emaar, International Finance Corporation, Shuaiba Industrial Company, Tasweek Real Estate Marketing and Development | Category: GCC News | Leave a comment

The G-20 summit at Pittsburgh laid the foundation for a new forum for global economic coordination as G8 countries recognized the growing importance of emerging economies. The leaders agreed to implement financial regulatory reforms and curb bankers pay. Nevertheless, negative macro-economic indicators emanating from the US kept investors cautious for the week ended September 25. In the US, existing home sales unexpectedly dropped 2.7 percent in August to 5.1 million annual rate against the forecasted rise to 5.35 million annual rate. The demand for US durable goods unexpectedly declined 2.4 percent in August compared to an expected 0.4 percent increase. Furthermore, the US Fed announced that it would decrease the size of two programs meant to support the credit market. These developments dented investor confidence and consequently the Dow Jones Industrial Average (DJIA) declined 1.58 percent, for the week ended September 25.

Asian markets ended the week on a negative note as six of the seven major indices closed in the red, driven by negative global cues. Shanghai SE composite, China’s benchmark index (down 4.18 percent), was the worst performer as investors funds were diverted to new share sales and growing concerns about a decline in new lending. Singapore’s Strait Times was the only gainer among its Asian Peers rising marginally by 0.56 percent. The BSE Sensex declined 0.29 percent amid concerns over slow economic recovery.

The Rupee appreciated 0.32 percent during the week as foreign institutional investors (FII) remained net buyers. Crude oil prices tumbled 8.4 percent to US$66.02 per barrel from US$72.04 last week due to weakening signs of an economic recovery, as US inventories of heating oil and distillate fuels reached a 26-year high.

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 To read complete commentary, please download the file.

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ARANCA is a leading provider of customized end-to-end investment research, business and IP research and IRC 409A valuation services to global clients. To know more about us and our services, click here

September 25th, 2009 | Tags: China benchmark, Crude oil, Dow Jones Industrial, foreign institutional investors, Shanghai SE | Category: India Weekly | Leave a comment

Positive macroeconomic data and encouraging statements pertaining to the economic outlook by the US Fed strengthened investor sentiment, triggering a rally in major equity markets for the week ended September 18. US retail sales increased 2.7 percent month-on-month to US$351.4 billion in August, higher than the 1.9 percent gain anticipated. Federal Reserve Bank of Philadelphia’s general economic index also jumped to 14.1 in September from 4.2 in August. Meanwhile, jobless claims fell by 12,000 to 545,000 for the week ended September 12. In Europe, UK retail sales remained unchanged in August from July when they climbed 0.2 percent. Strong economic signals emanating from the US reinforced hopes of a recovery. Consequently, the Dow Jones Industrial Average (DJIA) and FTSE 100 gained 2.24 percent and 3.22 percent, respectively, for the week ended September 18.

Asian markets ended the week on a positive note, with four of seven major indices rising during the week ended September 18. BSE Sensex, India’s benchmark index, was the best performer (up 2.93 percent) on positive domestic and global cues. The markets also gained as monsoons improved across the country raising hopes that the impact of the drought would be lesser than anticipated. Singapore’s Strait Times, the worst performer, declined 1.24 percent for the week ended September 18.
The Rupee appreciated 0.71 percent during the week as foreign institutional investors (FII) remained net buyers. Crude oil prices increased 4.0 percent to US$72.04 per barrel from US$69.29 last week due to increased hopes of a recovery and lower inventories.

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 To read complete commentary, please download the file.

______________________________________________________________________________

ARANCA is a leading provider of customized end-to-end investment research, business and IP research and IRC 409A valuation services to global clients. To know more about us and our services, click here

September 18th, 2009 | Tags: Dow Jones Industrial Average (DJIA), Federal Reserve Bank of Philadelphia, foreign institutional investors, FTSE | Category: India Weekly | Leave a comment