The MSM 30 index closed 1.38 per cent higher for the week ended February 21, to close at 5,980. The financial index gained 1.11 per cent, while services index gained 1.76 per cent and industry index gained 3.04 per cent.
Voltamp Energy reported a net profit of OMR1.30 million in 2012, a decline of 4.2 per cent year-on-year. Total revenue however grew 18.9 per cent year-on-year to OMR17.6 million. The company is expected to declare a cash dividend of 20 per cent for 2012 which will work out to a dividend yield of 5.4 per cent at its last traded price. The near-term outlook for this stock is negative.
Oman United Insurance announced plans to set up a takaful insurance company subject to approval at its AGM scheduled on March 28. As per Capital Market Authority (CMA) regulations, minimum capital requirement to set up a takaful firm is OMR10 million. The CMA has already issued in-principal approvals to three companies to set up takaful operations. Oman United Insurance has proposed to pay a cash dividend of 15 baisas for the current fiscal which amounts to a dividend yield of 6.7 per cent. The stock trades at 1.02 times its latest reported book value of 220 baisas. We have a buy recommendation on this stock.
Nawras has declared a cash dividend of 38 baisas per share for 2012. The stock offers a cash dividend yield of 7.25 per cent at its last traded price. We still have a bearish view on this stock. Most GCC markets had a good week led by Abu Dhabi, while Qatar and Saudi benchmark indices lost some ground.
Doha Bank board of directors have approved the 50 per cent planned increase in capital in two phases.
The first phase will include a 25 per cent capital increase via a rights issue to be priced at 30 Qatari riyals per share with record date for eligibility set on February 19. The second phase includes a further 25 per cent increase via Global Depositary Receipts (GDRs). The board also approved the proposed cash dividend of 4.50 riyals per share for 2012. The fair value of the stock post ex-dividend and ex-rights is 41.76 riyals per share.
Abu Dhabi Commercial Bank has initiated a share buy-back programme till date the bank has bought back approximately 1.116 million shares from the market at purchase prices of Dh3.81 and Dh3.85 per share. The stock currently trades at a P/BV multiple of 0.91x its latest reported book value per share. The stock offers a dividend yield of 6.3 per cent at its last traded price. We have a price target of Dh4.10 for the stock.
Sorouh Real Estate reported a 32 per cent year-on-year growth in net profit in 2012 at Dh508 million. Sorouh's planned merger with Aldar Properties is expected to be beneficial for itself as it will enable the company to get preferential access to government projects. Further, the recovery in the UAE real estate market is likely to increase the value of real estate properties in the country and as a result benefit real estate developers such as Sorouh. The stock currently trades below its tangible book value at a P/BV multiple of 0.76x, while proposed cash dividend of Dh0.06 per share implies a dividend yield of 3.2 per cent at its last traded price. Sorouh is one of our top picks in 2013.
Disclaimer: This column expresses only the views of the contributor and investing in stocks carries risk of financial loss for which the contributor is in no way liable.