MSM 30 firms post OMR661m net profit, up 21%: Survey


A picture of the Muscat Securities Market displaying the stocks being traded for the day. File Photo

Muscat: The total earnings of major companies that are included in the MSM 30 Index on the Muscat Securities Market (MSM) are estimated at OMR661.12 million for 2013, an increase of 20.8 per cent over the previous year.

The total revenue of MSM 30 companies for 2013 is estimated at OMR3.56 billion, an increase of 7.9 per cent, on better performance of financial and industrial firms, said a report released by Gulf Baader Capital Markets, yesterday.

Also, the total earnings of MSM 30 companies, excluding investment holding firms, for last year is estimated at OMR604.68 million, an increase of 17.6 per cent.

The total revenue of MSM 30 Index companies (excluding investment holding companies) is anticipated at OMR3.43 billion, indicating a growth of 7.3 per cent on robust local demand and strong industrial sector growth.

"We estimate that corporate earnings of MSM30 Index companies to grow in double digits on the back of higher revenue growth and the anticipated margin improvement in the industrial majors," added Gulf Baader report.

The report also noted that the revenue of banking sector is anticipated at OMR708.3 million, an increase of 6.7 per cent, led by high single digit credit growth, lower provisioning and stable asset quality. For 2013, the net profit of the sector is estimated to grow higher by 18.7 per cent to OMR312.699 million on certain one-offs like BankDhofar (OMR26.1 million legal case gains) and strong recoveries.  

Likewise, total revenue of the industry sector for 2013 is estimated at OMR963.7 million, an increase of 16.8 per cent on robust growth from few commodity, construction and building materials players.

Net profit of the sector is estimated to increase by 20.8 per cent to OMR79.8 million on stable demand in local market along with margin expansion in certain companies.

Services sector is estimated to reveal growth of 2.4 per cent in total revenue to OMR1.727 billion amid mid single-digit growth from oil marketing and telecom players. While 2013 sector earnings is expected to increase by 13.7 per cent to OMR207.2 million

Economic outlook
On the economic outlook, the report said Oman's economic growth will continue at steady pace during 2014. Project spending to remain strong during 2014, as OMR2 billion worth of tenders awarded in 2013.

Investment activity in economic zones, sea ports, airports and other Industrial clusters to drive growth.

Domestic liquidity remains strong; while bank interest rate to remain lower.

Also, corporate earnings will improve during 2014 amidst steady growth and strong earnings from the Industrial and Banking sector.

Overall, the MSM corporate earnings during the current year is estimated to increase by 9 per cent amid prevailing higher base.

Activity in the domestic equities has improved through enhanced market liquidity and receding risk aversion.

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