Markaz Research
البنك الأهلي الكويتي، بالتعاون مع شركة أهلي كابيتال و"كامكو إنفست" و"المركز" وشركة الوطني للاستثمار يُكمل بنجاح عملية إصدار سندات بقيمة 50 مليون دينار كويتي
نشرت: 12 - أكتوبر - 2021 قراءة المزيد
Markaz Research
"المركز": مكاسب الأسواق الكويتية مستمرة للشهر السادس على التوالي
نشرت: 04 - أكتوبر - 2021 قراءة المزيد
Markaz Research
"المركز": استمرار مكاسب الأسواق الكويتية للشهر السادس على التوالي وسط موجة تفاؤل بنتائج الأعمال إيجابية
نشرت: 05 - سبتمبر - 2021 قراءة المزيد
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بلوق حسب اسم الوسم

UAE Asset Management Industry - An Overview

التاريخ : 22/11/2015
مؤلف:  Marmore MENA

According to Marmore’s UAE Asset Management report, the UAE asset management industry manages USD 1,264.8mn in assets in about 31 funds as of 21st July, 2015. In terms of products, equity funds lead the pack with 69% share, followed by specialized funds at 20%. Remainder of the assets is spread across money market and fixed income funds. Of the total assets, Islamic funds manage USD 435mn (34.4%) in assets and rest is conventional funds. In terms of the number of funds, there are 23 equity funds, 4 money market funds, 3 specialized funds and 1 fixed income fund.

AUM/GDP ratio for the UAE stands at 0.5%, implying lack of mutual fund penetration as an investment option. The UAE asset management market is small in comparison to Saudi Arabia and Kuwait.  The top five asset managers (out of a total of 10) account for 75% of the total assets being managed; Abu Dhabi Commercial Bank PJSC leads the list of large asset management companies with USD 374mn in assets (29% market share), followed by Emirates NBD Asset Management Limited with USD 339mn in assets (26% share) and Abu Dhabi Investment Company with USD 153mn in assets (12% share).

Analyzing total Assets under Management based on country wise geographical focus we find that UAE stands at 6th position with USD 1,264.8 Mn of AUM. Saudi Arabia is the dominant player in the MENA asset management industry.

We look at the various participants in the UAE asset management market. They range from conventional and Islamic funds, Insurance companies, Pension funds and Sovereign wealth funds. 

AUM Break Up

Total AUM can be further subdivided into Conventional Funds amounting to USD 829.8 Mn and Islamic Funds amounting to USD 435 Mn.

Figure 1: UAE Funds Break Up - Conventional and Islamic 

Total AUM can be further subdidvided as Equity (USD 877.9mn), Fixed Income (USD 40.4mn) , Money Market (USD 92.3mn) and Specialized (USD 254mn).

Figure 2: UAE Funds Break up - Asset Type

Pension Funds

UAE lacks a fully developed private and employer managed pensions industry. The UAE’s total retirement benefits are worth approximately USD 3Bn and are managed by two state providers – the General Pensions and Social Security Authority and the Abu Dhabi Retirement Pensions and Benefit Fund.

Abu Dhabi Retirement Pensions and Benefit Fund

Abu Dhabi Retirement Pensions and Benefits Fund (ADRPBF) was founded in 2000 to manage contributions, pensions and end of service benefits for UAE nationals working in or retired from the government, semi- Government and private sectors in the Emirate of Abu Dhabi, and their beneficiaries. The latest available annual report (2013) shows that the fund invests in more than 50 countries.

The General Pensions and Social Security Authority

The principal activity is the administration of pension and social security insurance plans for the benefit of nationals in the government and private sectors. The authority was established in 1999.

Insurance Companies

In terms of insurance penetration, total revenue and insurance density, the UAE is the leading country in the GCC region. In 2014, the UAE insurance industry produced over USD 6.29bn  of insurance revenues. This makes UAE the largest insurance market in the GCC region. The UAE has presence of both large local groups (Oman Insurance, Abu Dhabi National & Salama) and foreign insurers (RSA, AXA, Zurich).

Figure 3: GCC Insurance Penetration in 2014 (Premium as a % of GDP) (Total Business)*


The investment mix of insurance companies since 2010 shows 30% of funds allocated to high risk / high return investment especially shares out of total 60% of the funds allocated in shares and bonds. The recovery of the stock markets, the high returns generated in 2013 by the stock markets in Dubai and the inclusion into the MSCI emerging markets have increased the investor confidence.

Sovereign Wealth Funds

There are 7 Sovereign Wealth Funds (SWFs) operating in the UAE . The oldest and the largest fund by asset size is Abu Dhabi Investment Authority (ADIA). The fund was established in 1976 and has a size of USD 773bn as of July 2015 . The main funding source of the fund is from financial surplus generated through oil exports. ADIA is also the largest sovereign wealth fund in the Middle East. It is wholly owned and subject to supervision by the government of Abu Dhabi. Emirates Investment Authority (EIA) is the first federal sovereign wealth fund for all seven states comprising the UAE.

Foreign Investors

The revised UAE commercial company’s law draft has been approved by the UAE Federal National Council, as announced on 28 May 2013. The status quo in relation to the foreign ownership limit has been maintained. Existing requirement is for the UAE companies to be owned at least 51% by UAE nationals and foreign ownership is restricted up to 49%. Hence, foreign investor’s participation is currently restricted in the UAE companies. However, companies which are established in UAE free zones are permitted to be 100% foreign owned but are subject to certain trading restrictions of which investors should be aware . Companies listed on NASDAQ Dubai have no foreign ownership restrictions.

Retail Participation

UAE  equity market is dominated by retail participants and they account for the bulk of trading activity. While, ultra high net worth individuals (UHNI’s) are a niche group who are predominantly served by private bankers, retail clients are a polarized group who either trade aggresively or shun markets altogether and invest in bank deposits. Analysing the data for the recent past indicate dominance of individual participants in the total value traded. Individual particpation was 57.9% in the total value traded of Dubai Financial Market. Individual participation was 65.5% in the total value traded of Abu Dhabi Securities Exchange (May 2015). The individual participation has declined in both the Dubai and Abu Dhabi stock markets compared to 2012 when it more than 70% in  both Dubai and Abu Dhabi markets.

Published by: Marmore MENA

علامات:  Asset Management, Capital Markets, Equity, Fixed Income, Mutual Funds

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GCC Markets - Who created value in the medium/long-term?

التاريخ : 18/11/2015
مؤلف:  Marmore MENA


The main goal of an investor or a money manager is to create wealth - be it through capital appreciation strategy, dividend strategy or a capital preservation strategy. Unfortunately over the last 10 year period (2005-October 2015) all but Muscat stock exchange failed to create wealth for investors. That said, looking at the 5 year data, UAE and Qatar posted remarkable returns compared to its peers. Dubai and Abu Dhabi posted 16% and 11% five year CAGR respectively while Qatar posted 9% during the same period the main catalyst for Qatar and the UAE was the inclusion of their respective markets in MSCI EM Index. Assuming investors picked a passive strategy , they would have failed to create wealth over the 10 year period (except Oman) and the 5 year period (barring UAE and Qatar)

While at a macro level markets did not create value, at a stock level we have many winners and losers. After dissecting the stock universe based on size (large, mid and small), we applied liquidity filter (to weed out illiquid companies) to see how they stack up. Here are the results of GCC value creators.

Large Cap GCC companies

We identified 30 large cap companies for our 10 year analysis and 40 companies for our 5 year analysis dominated mostly by banks followed by Telecom. Over the past 10 years, large caps yielded a CAGR of -4% (the range was between +14% and -10%). The range was more pronounced in the 5 year period, during which GCC large caps posted returns ranging between +34% to -23%. However on an average, GCC large cap companies posted +7% (5 year CAGR).


Banks dominated over the 5 and 10 year period
Source: Reuters and Marmore, the chart shows the dominance of each sector, measured by the total number of companies in our study

Mid Cap GCC companies

Most money managers will focus on large and medium cap companies within their asset allocation strategy since small cap companies are considered risky. Had they invested in mid cap companies, would money managers have outperformed top heavy allocations? In short, yes, since mid cap companies performed better than large caps on both 10 and 5 year periods. Over the 10 year period the CAGR was -2% (50% less than large caps) while 5 year average CAGR was slightly better than large caps at 8% In this study we identified 144 companies that fit our criteria for the 5 year period and 98 companies that fit our 10 year period criteria.

Banks dominated the scene in the 5 year term however in the long run (10 years) retail had the largest share of companies that fit our criteria

Small Cap Companies

In our study of small cap companies, 418 companies matched our 5 year criteria and 287 companies matched our 10 year criteria. On average small caps destroyed wealth, be it during the medium term investment period of 5 years or a long term period of 10 years. GCC small cap destroyed wealth on average by -1% CAGR during the 5 year period and -6% during the 10 year period.

The ranges of returns were the highest among the 3 classifications (large, mid and small cap). In the 5 year CAGR timeline, GCC small caps posted a high of 41% and a low of -39%. When pulling the data further to 10 years, the range of return was quite similar +44% to -36%. 


No significant leader in the 5 and 10 year sphere as plethora of companies are represented in the small cap sphere


Source: Reuters, Marmore the chart shows the dominance of each sector, measured by the total number of companies in our study

Final Words

All in all, GCC market performance over the past decade was negative. Over the past 5 years, only large and medium cap companies created value (based on our liquidity criteria). Moreover, banks clearly dominated the pool of sectors. That said investors should evaluate their investment strategy annually and make appropriate changes to avoid capital loss. Our experiment shows that simply being a long term dormant investor does not work as everything changes with time and so should our investment strategy and outlook. Passive investors who invested in 2005 have no edge over people who invested in 2010 or few years ago.

Published by: Marmore MENA

علامات:  Capital Markets, GCC Markets

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SABIC - Low Oil Prices Pressurizing Top Line

التاريخ : 12/11/2015
مؤلف:  Marmore MENA

SABIC was established in 1976 by Royal decree, and is currently ranked amongst the world’s largest petrochemicals manufacturer. According to Marmore’s company report on SABIC, the petrochemical segment contributed over 86% to SABIC’s revenue in 2014. The next big segment in terms of revenue is the minerals/metals segment, generating over 5% of the revenue.  From 2010-14, the revenue from all the four business segments has grown at CAGR of 6%.

Revenue – Remain flat post stellar numbers in 2011
The total revenue of SABIC has increased after 2009 as the global markets recovered post the 2008 recession. According to the Global Platts Petrochemical Index, petrochemical prices declined by 30% in 2014 compared to 2013 price levels. The primary reason for the drop in sales in 2014 is the decline in oil prices in the last quarter of 2014, resulting in drop in the petrochemical product prices. Revenues have continued to decline during the 1st 9 months of 2015, dropping by 20% YoY (2014 9M earnings $ 38,788 Mn). Drop in revenues was attributed to the drop in selling prices of the petrochemical and other products that the company sells. While the company has not officially stated a reason for the decline in the prices of its products, it can largely be attributed to the falling oil prices.

Figure 1: Total Revenues 2010-15 (USD Mn)

Source: Reuters

The petrochemical and fertilizer segment contributed over 86% to SABIC’s revenue in 2014. The next big segment in terms of revenue is the minerals/metals segment, generating over 6% of revenue. Throughout 2010 to 2014 petrochemical segment has generated revenue in excess of 80% of the company’s total revenue. SABIC is focused to be the leading player in this segment of business and almost 70% of the plant capacity was utilized to manufacture products which are part of the petrochemical business.

The operating profit margin of SABIC has witnessed a decline since 2011. Following record revenues in 2011 the operating profit margin reached 26% while in the subsequent years they were hovering between 22%-23% before falling to 20% in 2014. The Net profit margin has also followed a similar pattern. While the revenues for the 1st 9 months of 2015 fell by over 20% the net profit margin fared slightly better compared to the same period last year. Net profit for 2015 9M stands at 13.66% as against 13.11% during 2014 9M while the operating profit declined from 21.53% to 20.89% during the same period. The improvement in net profit margin could be attributed to the cost cutting that the company has managed during 2015.

Figure 2: Operating profit and Net profit 2010-15 

Source: Reuters

ROE (Return on Equity) – ROA (Return on Assets) – In line with Revenues

According to Marmore’s company report on SABIC, both ROE and ROA trends have been consistent with SABIC’s revenue. The ROE and ROA reached its peak in 2011 at 14.80% and 22.60%, respectively, before declining in 2012. Continued slow global economic growth in 2014, malaise in China (one the key markets for SABIC) and decline in product prices due to lower oil prices has reflected in the revenues and earnings of 2014. However, an increase in equity and a marginal increase in assets value in 2014 resulted in lower ROE and ROA relative to 2013. Though the likelihood of outperforming in the near to medium term are high due to the cyclical recovery and potential for structural recovery in its European operations and new investments in the pipeline, the lower oil prices resulting in lower products prices can be a major hindrance to the recovery.

Figure 3: ROE & ROA, (2010-14)

Share Performance

SABIC’s share performance has seen wide swings this year. While the share price continued to increase during the 1st half of the year it started to decline in the 2nd half of the year largely due to the negative impact that the Chinese stock market had on global stock markets. SABIC reached its peak of 108.75 on 04th May 2015 before falling to a low of 72 on 24th Aug 2015. It ended at 82.25on Oct 28th 2015. The Saudi Stock index’s performance has been even more underwhelming; TASI reached its peak of 9,834.39 on 30th April 2015 before falling to 7,024.6 on 24th August 2015. TASI ended at 7,118.42 on Oct 28th 2015. Year to date returns of SABIC and TASI has been negative at -2.1% and -14.6% respectively.   

Figure 4: SABIC Share Performance (YTD – 2015) - Rebased

Blog Source by, Marmore MENA Intelligence

علامات:  Company Analysis, Financial Analysis, SABIC, Share performance

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Fiscal Measures Worry Markets

التاريخ : 10/11/2015
مؤلف:  Marmore MENA

According to Marmore’s recently released Monthly Market Review, MENA markets ended mostly in red during the month of October 2015. Abu Dhabi (-4.0%) suffered the most, followed by Saudi Arabia (-3.8%), Dubai (-2.5%) and Bahrain (-2.0%). Despite the increase in oil prices during October, the lower-than-expected oil prices continue to strain the MENA markets. The regional markets are also responding to instability in the global economy and anticipated monetary tightening in response to low oil prices.  KSA is contemplating spending cuts and tax increases to manage its fiscal deficit. Saudi Arabia's weakness is dampening sentiments of the region, even in countries such as the United Arab Emirates & Kuwait, which are relatively well placed to cope with an era of cheap oil. Egypt (3.1%), Oman (2.4%) and Qatar (1.2%) markets gained in October. Kuwait’s price index ended the month of October with a marginal gain of 0.9%. On the contrary the Kuwait weighted index remained stagnant. 

Global equities ended the October month with strong gains after a sharp fall in August and September, which was fueled by fears over the global slowdown, with China as the epicenter. Oil prices rose after the U.S. oil rig count fell for a ninth straight week, indicating potentially lower crude output in coming months in the face of a global supply glut. Subdued worries about slowing Chinese growth, proactive approach of rate cuts by People’s Bank of China to stimulate the economy and investor’s positive response to U.S. Federal Reserve continued lower interest rates low and the European Central Bank further easing are some of the key reasons that fueled the rally of the Global equity markets in October.
MENA markets liquidity gained some momentum in October, with volume increasing by 12% and value traded by 14.2%, post the lulled market activity due to Eid and investor sentiments. However, Abu Dhabi, Dubai and Bahrain are a few exceptions where the trading activity declined. Amongst the MENA markets, Morocco showed the most improvement with value traded increasing by 33.3% and volume traded increasing by 58%. With the value traded declining by 79% and volume by 68%, Bahrain’s market liquidity was worst hit. 
Emirates Telecom (UAE) has benefited from its decision to allow foreign and institutional investors to own its shares from Mid-September and has rallied since then. Despite the drop of 9% in Q3 profits, it managed to be the top gainer (7%) in October, followed by SABIC (KSA) and NCB (KSA) which gained 4.8% and 4.5% respectively. First Gulf Bank (-11.5%), National Bank of Abu Dhabi (-8.6%) and Al Rajhi Bank (-5.9%) were the top three losers in October. With the top three losers being banks, it is evident that banks in the region are grappling with margin pressures and liquidity issues as the oil producing states face a squeeze on budgets from lower oil prices.
Saudi Arabian Government is actively pursuing several initiatives to keep its fiscal budget deficit in check. Saudi Arabia is considering raising domestic energy prices; the existing system of subsidies in the kingdom is blamed for waste and surging fuel consumption. Saudi Arabia's government was in talks with local banks to sell them 20 billion riyals (USD 5.3 billion) of local currency bonds.

Figure 1: Brent Crude and WTI, 2014-Present, USD per barrel

Iran will officially notify producer group Organization of Petroleum Exporting Countries (OPEC) in December of its plans to raise its crude oil output by 500,000 barrels per day (bpd). Kuwait said there were no calls within OPEC to change the oil group's production policy and that lower output from high-cost producers could support prices in 2016, adding to signs OPEC will keep its strategy of defending market share. Meanwhile, OPEC forecast in a monthly report that demand for its oil in 2016 would be much higher than previously thought as lower prices curb U.S. shale oil and other rival supply sources, reducing a global surplus. U.S. oil drillers removed 16 rigs in the week ended Oct. 30, bringing the total rig count down to 578, the least since June 2010.

علامات:  Capital Markets, Economy, GCC Markets, MENA

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لماذا تعتبر السيولة مهمة؟ بعض المقتطفات والقصاصات البحثية

التاريخ : 20/04/2014
مؤلف:  ام ار راجو

تعتبرالسيولة من الدعائم الأساسية لتطورالأسواق ولا تستثنى البورصات الخليجية من هذه القاعدة. إن وجود الثروة التي تدعمها أسعار النفط المرتفعة إلى جانب طبيعة السوق كونه سوق تجزئة يستهدف النشاطات المضاربية، ساهما في وجود مستويات سيولة مرتفعة في السابق وخصوصاً بعد الأزمة المالية العالمية. تقاس السيولة على حسب القيمة الإجمالية المتداولة وتظهر كنسبة من إجمالي القيمة السوقية (الرأسمالية) لتحدد قيمة سرعة الدوران. يدل المستوى المرتفع لسرعة الدوران على تقدم السيولة على السوق والعكس صحيح. كما ان وجود مستويات مرتفعة من السيولة يشمل مزايا ومنافع أخرى مثل تكلفة الصفقات. وفي سياق أسواق الاسهم الخليجية، هناك بعض الاسئلة التي تحتاج لبعض الأجوبة.

  1. كم انخفض مستوى السيولة لمحركي مؤشرات الأسواق الرئيسية مقارنة إلى ما قبل وبعد الأزمة المالية العالمية؟
  2. ما مدى تأثيرانخفاض معدلات السيولة على هامش الفرق بين سعر العرض وسعر الطلب؟ (معدل تقريبي لقياس تكلفة الصفقات)
  3. هل توجد بعض التناقضات في ذلك ولو وجدت. كيف يمكن تفسيرها؟

قبل الإجابة على تلك الأسئلة، دعونا نقوم بشرح طريقة إجراء هذا البحث القصير:

  1. قمنا بتجميع بيانات عن الحجم اليومي والقيمة المتداولة والقيمة السوقية/الرأسمالية وهامش الفرق بين سعر العرض وسعر الطلب لأسهم خمسة عشرة شركة من الشركات الكبيرة في أسواق الأسهم الخليجية.
  2. ثم قمنا بترتيب البيانات المجمعة زمنيا إلى ما قبل الأزمة المالية العالمية ( قبل 2008)  أو ما بعدها (بعد عام 2008).
  3. قمنا بحساب معدل القيمة المتداولة اليومية  كمقياس السيولة لجميع الاسهم.
  4. وقمنا أيضاً بحساب معدل الدوران؟ ( وتعرف كمجموع الأسهم المتداولة الإجمالية / عدد الأسهم القائمة)

دعونا ننتقل إلى النتائج التي توصلنا إليها في محاولة الإجابة على أسئلتنا :
يوضح الجدول الأول التغيير الحاصل في ما قبل الأزمة العالمية (2003-2008) وما بعد الأزمة المالية العالمية (2009-2013)

  1. كيف يتم قياس انخفاض معدلات السيولة للمؤشرات الرئيسية بالنسبة إلى ما قبل وبعد الأزمة  المالية العالمية؟

فيما يتعلق بالسؤال الأول، انخفضت معدلات السيولة ؟ وبعد الأزمة المالية العالمية كما كان متوقع. على سبيل المثال، و استقر حجم القيمة المتداولة لدى شركة سابيك السعودية عند 178 مليون دولار أمريكي خلال الفترة من 2003-  2008
ما بعد سنة 2008 انخفضت القيمة المتداولة اليومية بنسبة 27% لتصل إلى 130 مليون دولار أمريكي . شهدت شركة الإتصالات السعودية انخفاض كبير في القيمة المتداولة اليومية من 100 مليون دولار أمريكي إلى 119 مليون دولار أمريكي وبنسبة 90%. يوضح الجدول مدى تأثير الأزمة على معدل القيمة المتداولة.

الجدول رقم (2) ملخص النتائج

  1. ما تأثير الإنخفاض على هامش الفرق بين سعر الطلب وسعر العرض (قياس تقريبي لحساب تكلفة الصفقات)

في حالة ازياد انتشار الأسهم الخليجية الكبيرة  استجابة لإنخفاض مستويات السيولة لمعظمها.  كان انتشار سابيك  بنسبة 0.23% قبيل الأزمة المالية العالمية ولكن بعد حدوث الأزمة  زاد إلى نسبة 0.3% .في حالة شركة سعودية تلكوم زاد الإنتشار هامشياً من 0.27% إلى  0.29%. شهدت شركة زين  أكبر نسبة انتشار حسث قبل الأزمة المالية العالمية  كانت نسبة الإنتشار حوالي نسبة 0.75% ( وهذه نسبة مرتفعة مقارنة بالشركات السعودية) وارتفعت بعد الأزمة المالية العالمية من 88% إلى 1.42% وهذا لا يرجع  تماماً  إلى انخفاض معدل القيمة المتداولة حيث انخفض معدل القيمة المتداولة إلى نسبة 9% مقارنة إلى الأرقام المسجلة قبل الأزمة المالية العالمية

  1. هل توجد بعض التناقضات في هذا؟ ولو وجدت كيف يمكن تفسيرها؟

أخيراً،هل توجد بعض التناقضات؟ أظهرت بعض الشركات في هذه الدراسة علاقة إيجابية في هذا المجال مع انخفاض مستوى السيولة، وانخفاض هامش سعر العرض وسعر الطلب وبالعكس. وتشتمل الأمثلة شركات مثل اعمار وبنك الخليج الأول وضناعات قطر. لكن يبقى السبب الرئيسي وراء العلاقة الإيجابية في الشركات المذكورة  هو عدم وجود معلومات كافية لعقد مقارنة عادلة  ومنصفة بين الأرقام المسجلة ما قبل وبعد الأزمة المالية العالمية. الشركة التي تمتلك معلومات كافية هي شركة سامبا ويرجع ذلك إلى انخفاض مستوى السيولة بسبب الازمة المالية العالمية مع انخفاض هامش الفرق بين سعر الطلب والعرض لمثيلاتها من الشركات. وبمعنى أخر، كان هامش الفرق بين سعر الطلب والعرض الأعلى لسامبا بين البنوك السعودية المشمولة وبالتالي انخفضت الأرقام بعد الازمة المالية العالمية لتصبح موازية للبنوك السعودية الأخرى.

الأفكار الختامية:
ان هامش الفرق بين سعر العرض والطل للأسهم القيادية الخليجية اليوم مرتفعا  بفضل إلى مستوى السيولة المنخفض. ويتراوح من نسبة منخفضة تصل إلى 0.81% ( صناعات قطر) إلى نسبة 1.52% ( بنك الكويت الوطني). ومستقبلا، مع تحسن مستوى السيولة  يمكن أن يعود هامش الفرق إلى مستويات شوهدت قبل الأزمة المالية العالمية. وستزداد جاذبية الاسواق  للمستثمرين من المؤسسات فيما لو تحسنت مستويات السيولة التي تخفض من هامش الفرق بين سعر العرض والطلب.

علامات:  الأسواق الخليجية, سوق الأسهم, نفط

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