ADCB, Emaar Among UAE’s Favourite Stocks

MubasherTrade report forecasts low-to-mid-single digit economic growth rates in the Middle East in 2014.



Abu Dhabi Commercial Bank (ADCB), Aldar, Emaar and Aramex were named as the favourite UAE stocks to invest, according to MubasherTrade research.

The report listed 20 stocks in five Middle East markets, highlighting the top investment ideas across the region.

All the four ‘favoured’ UAE companies have reported strong financial results this year – ADCB reported a net profit of Dhs2.714 billion in the first nine months of 2013, up 26 per cent year-on-year while Aldar Properties has seen a positive rise in its stock value ever since its merger with its former rival Sorouh Real Estate earlier this year. Dubai’s largest builder Emaar also reported a 50 per cent rise in third quarter net profit as the emirate’s property sector regained strength, and logistics firm Aramex posted a third quarter net profit of Dhs59.9 million compared to Dhs53.1 million in the corresponding period in 2012.

The report also listed favoured stocks from Qatar and Saudi Arabia.

Mobily, SABIC, SABB and Saudi Ceramics were the Kingdom’s top stocks that offered an ideal investment opportunity while Qatar’s favourite stocks included Commercial Bank of Qatar, Ooredoo and Qatar Electricity and Water.

MubasherTrade’s recent research has also suggested a re-rating of Arab equity markets owing to their strong economic growth and abundant liquidity within the region.

Despite strong economic growth in the Middle East, the value of total equities traded dropped 18 per cent during the first 10 months of this year to $433 billion. The drop was mainly due to a fall in Saudi Arabia’s and Egypt’s markets, the report said.

However, excluding both markets, the value of equities traded almost doubled to $114 billion in the first 10 months with the UAE and Kuwait leading the growth.

The report forecasts low-to-mid-single digit economic growth rates in the Middle East, mainly led by growth in the markets of Qatar (5.2 per cent), Saudi Arabia (4.5 per cent) and the UAE (3.6 per cent). Yet these rates buck the global growth rate of 2.8 per cent in 2014.

“We expect traded values to improve in 2014, particularly in Egypt (provided political stability is restored) and in Qatar and the UAE (with the effective inclusion of both markets in MSCI Emerging Markets Index “MSCI EM” mid-2014),” said Amr Hussein Elalfy, CFA, global head of research at MubasherTrade research.

“Meanwhile, Saudi Arabia will continue to have the lion’s share of Arab markets’ equities traded values with further upside expected whenever the market is opened to foreign investors.”