Week ended Feb 08, Week ended Feb 15, Chg. % Market Indicators

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1 ` Market Review and Outlook The Qatar Stock Exchange (QSE) Index increased points or 1.51% during the trading week to close at 9, Market capitalization inched up by 0.8% to QR481.4 billion (bn) versus QR477.8bn at the end of the previous trading week. Of the 45 listed companies, 29 companies ended the week higher, while 13 declined and 3 companies remained unchanged. Qatar Islamic Insurance Co. (QISI) was the best performing stock for the week with a gain of 8.2% on 707.6k shares traded. On the other hand, Ezdan Holding (ERES) was the worst performing stock for the week with a decline of 3.1% on 967.2k shares traded. Masraf Al Rayan (MARK), QNB Group (QNBK) and Barwa Real Estate (BRES) were the primary contributors to the weekly index gains. MARK was the biggest contributor to the index s weekly increase, adding points to the index. QNBK was the second biggest contributor to the mentioned gains, contributing points to the index. Moreover, BRES tacked on points to the index. However, Ooredoo (ORDS) deleted 9.84 points from the index. Trading value during the week decreased by 37.1% to reach QR809.3 million (mn) versus QR1.3bn in the prior week. The Banks and Financial Services sector led the trading value during the week, accounting for 45.8% of the total trading value. The Industrials sector was the second biggest contributor to the overall trading value, accounting for 20.2% of the total trading value. QNBK was the top value traded stock during the week with total traded value of QR85.7mn. Trading volume decreased by 30.1% to reach 36.2mn shares versus 51.8mn shares in the prior week. The number of transactions dropped by 35.2% to reach 14,439 transactions versus 22,273 transactions in the prior week. The Banks and Financial Services sector led the trading volume, accounting for 47.7%, followed by the Industrials sector which accounted for 18.6% of the overall trading volume. Qatar First Bank (QFBQ) was the top volume traded stock during the week with 7.8mn shares. Foreign institutions turned bearish with net selling of QR30.5mn vs. net buying of QR49.5mn in the prior week. Qatari institutions turned bullish with net buying of QR71.8mn vs. net selling of QR49.3mn in the week before. Foreign retail investors turned bearish with net selling of QR20.0mn vs. net buying of QR2.1mn in the prior week. Qatari retail investors remained bearish with net selling of QR21.2mn vs. net selling of QR2.4mn the week before. Foreign institutions bought (on a net basis) ~$34.7mn worth of Qatari equities since the beginning of QSE Index and Volume 9,100 9,000 8,900 Market Indicators Week ended Feb 15, 2018 Week ended Feb 08, 2018 Chg. % Value Traded (QR mn) ,286.1 (37.1) Exch. Market Cap. (QR mn) 481, , Volume (mn) (30.1) Number of Transactions 14,439 22,273 (35.2) Companies Traded Market Breadth 29:13 7:36 Market Indices Close WTD% MTD% YTD% Total Return 15, (1.3) 6.6 ALL Share Index 2, (2.9) 2.5 Banks and Financial Services 2, Industrials 2, (3.1) 5.2 Transportation 1, (0.2) (4.4) 8.1 Real Estate 1, (0.3) (10.9) (7.7) Insurance 3, (5.2) (7.5) Telecoms 1, (5.2) (5.5) Consumer Goods & Services 5, (0.3) (0.6) 8.7 Al Rayan Islamic Index 3, Market Indices Weekly Index Performance 2.0% 1.0% 0.0% (1.0%) 9, , , Feb 12-Feb 13-Feb 14-Feb 15-Feb 1.6% 1.5% Kuwait Qatar (QSE)* QSE closed Volume QSE Index 0.5% 0.2% 0.2% 0.1% Bahrain Saudi Arabia Oman Dubai 9, (0.5%) Abu Dhabi 12,000,000 6,000,000 0 Regional Indices Close WTD% MTD% YTD% Weekly Exchange Traded Value ($ mn) Exchange Mkt. Cap. ($ mn) TTM P/E** P/B** Dividend Yield Qatar (QSE)* 9, (1.9) , Dubai 3, (1.9) (1.2) ,189.5 # Abu Dhabi 4, (0.5) (0.5) , Saudi Arabia # 7, (3.0) 2.7 4, , Kuwait 6, , Oman 5, (1.6) , Bahrain 1, (0.8) , Source: Bloomberg, country exchanges and Zawya (** Trailing Twelve Months; * Value traded ($ mn) do not include special trades, if any; # Data as of February 14, 2018) Page 1 of 6

2 News Economic & Corporate News IQCD reports QR957.7mn net profit in 4Q2017; ups dividend from QR4 to QR5 (4.7% yield); Maintain Market Perform rating with QR109 PT Industries Qatar (IQCD) reported net profit of QR957.7mn in 4Q2017 as compared to QR747.8mn in 3Q2017, versus our estimate of QR1,068.26mn (variation of 10%). QR40mn in impairments from its associate SOLD steel made contributed to the miss of roughly QR110mn relative to our net income estimate. EPS increased to QR5.48 in FY2017 from QR4.88 in FY2016. The board of directors recommended cash dividend of QR5 per share for the period, higher than our estimate of QR4.5 per share. According to the company s statement, despite a challenging environment, IQCD maintained its production levels, and sales volumes, reduced its controllable operating expenditure, and marginally improved its selling prices. Relative to our model, we saw another quarter of surprisingly strong steel revenue but costs remained sticky. JV income from PE and fertilizers was in line with our estimate with strength in fertilizers offset by a weaker-than-expected contribution from PE. According to the company, on a like-for-like basis, management reporting revenue, assuming proportionate consolidation, was QR14.3bn, improving slightly over FY2016. The petrochemical segment has shown marked recovery, while the fertilizer and steel segments have shown slight improvements over the last year. The recovery and stability of the crude oil prices together with reduced supplies, most notably due to unplanned outages in some large facilities in some large economies during 2H2017, have contributed to the improvement in the petrochemical prices, IQCD stated. Fertilizer prices have shown modest upward momentum, most specifically in the fourth quarter of 2017 on increased demand in some of the large agricultural economies, it stated, adding steel prices moved within a narrow range with prices gaining momentum in the later part of the year. The increase in raw materials costs, short supply of some consumables together with higher demand in some destinations were the key factors in stabilizing the prices in the tail end of IQCD s financial position remains solid as cash across the group stands at QR10.3bn after paying 2016 s dividend of QR2.4bn, and periodic debt payments amounting to QR2.4bn across the group. Total debt across the group was QR0.5bn, down from QR2.9bn as on December 31, (QSE, QNBFS Research, Gulf-Times.com) BRES reports ~QR483mn net profit in 4Q2017 Barwa Real Estate Company (BRES) reported net profit of ~QR483mn in 4Q2017 as compared to QR310.5mn in 3Q2017. EPS amounted to QR4.38 in FY2017 as compared to QR4.13 in FY2016. BRES board of directors proposed a cash dividend of 25 % of the company s paid up capital, equal to QR2.5 per share, to be approved at the annual general assembly meeting. BRES real estate portfolio has grown to include 6,639 housing units, 12,706 worker rooms, and 265,000 square meters of shops, showrooms, and offices. In FY2017, BRES posted 6% growth in net profit to reach QR1.7bn. BRES enhanced operating revenues by increasing its net rental income by QR140mn, an 18% increase compared to FY2016 as a result of the increase in occupancy rates of Barwa AlBaraha. Also, net revenue of consultancy services and other services increased by QR85mn. The improvement in BRES operating revenue was reflected in the total equity attributable to equity holders, which increased by QR695mn, reaching the balance of QR18.9bn as of December 31, Total assets increased by QR599mn, while the BRES liabilities decreased by QR181mn. BRES also maintained sufficient cash balances to cover the group s operations and to cope with fluctuations in the finance markets with a balance of QR3.1bn. (QSE, Gulf-Times.com) NLCS reports QR23.31mn net profit in 4Q2017 Alijarah Holding (NLCS) recorded a net profit of QR23.31mn in 4Q2017 as compared to a net loss of QR11.25mn in 3Q2017. However, on YoY basis net profit rose sharply from QR0.11mn in 4Q2016. The company s total revenues & income came in at QR19.57mn in 4Q2017, which represents a decrease of 37.1% QoQ (-59% YoY). EPS amounted to QR0.06 in FY2017 as compared to QR0.10 in FY2016. NLCS board of directors resolved in its meeting to propose in the forthcoming General Assembly Meeting, which will be held on March 5, 2018, distribution of cash dividend of 5% of the nominal share value i.e. QR0.50 per share. (QSE) ORDS net profit narrows to ~QR408mn in 4Q2017 Ooredoo (ORDS) reported net profit of ~QR408mn in 4Q2017 as compared to QR461.9mn in 3Q2017. EPS decreased to QR6.14 in FY2017 from QR6.84 in FY2016. ORDS board of directors proposed cash dividend of QR3.5 per share for FY2017. Driven by a growth in revenues, increased monetization of data business and improving customer base in multiple markets, ORDS posted revenue of QR33bn and a net profit of nearly QR2bn in FY2017. ORDS EBITDA increased 3% to QR13.8bn with a corresponding increase in EBITDA margin to 42%, indicating a further improvement in operational performance from FY2016 (i.e. 41%). Excluding foreign exchange translation impact, EBITDA increased by 4% YoY. Revenue in FY2017 increased to QR32.7bn, driven by strong contributions from Indonesia, Iraq, Kuwait, Maldives and Oman. Excluding foreign exchange translation impact, revenues increased by 2% compared to the reported 1% revenue increase. New government levies in Oman and one-off provision reversals in FY2016 led to a decrease in ORDS net profit by 10% to QR2bn. Excluding these, the normalized net profit attributable to ORDS shareholders increased by 1%. (QSE, Gulf-Times.com) QIMD's net profit declines 14.9% QoQ in 4Q2017 Qatar Industrial Manufacturing Company's (QIMD) net profit declined 14.9% QoQ to QR42.63mn in 4Q2017. However, on YoY basis net profit rose 38.8%. The company's sales came in at QR96.37mn in 4Q2017, which represents an increase of 10.9% QoQ. However, on YoY basis sales fell 66.8%. EPS amounted to QR4.34 in FY2017 as compared to QR4.08 in FY2016. QIMD s board of directors proposed cash dividend of QR3 per share for FY2017. The board also announced the Ordinary and Extraordinary General Assembly Meeting (EGM) to be held on March 11, 2018 to discuss the agenda. In the absence of Quorum, a second meeting will be held on March 18, (QSE) Page 2 of 6

3 Qatar Stock Exchange Top Gainers Top Decliners 9.0% 8.2% 8.1% 7.5% 7.0% 6.7% 0.0% 6.0% -2.0% -2.4% -2.1% -3.1% -3.1% -2.9% 3.0% -4.0% 0.0% Qatar Islamic Insurance Vodafone Qatar Al Khaliji Qatari Investors Group Gulf Warehousing -6.0% Ezdan Real Estate Milaha Mannai Corp. Qatar Cinema & Salam International Film Distribution Investment Most Active Shares by Value (QR Million) Most Active Shares by Volume (Million) QNB Group Masraf Al Rayan Barwa Real Estate Qatar First Bank Industries Qatar 0.0 Qatar First Bank Vodafone Qatar Al Khaliji United Development Gulf International Services Investor Trading Percentage to Total Value Traded Net Traded Value by Nationality (QR Million) 100% 80% 17.33% 21.11% 14.98% 17.45% (51) Non-Qatari % 23.88% 15.01% 40% 20% 43.81% 46.44% Qatari % Buy Sell 548 Qatari Individuals Qatari Institutions (100) Non-Qatari Individuals Non-Qatari Institutions Net Investment Total Sold Total Bought Page 3 of 6

4 TECHNICAL ANALYSIS OF THE QSE INDEX Source: Bloomberg The Index closed up 1.51% from the week before; it ended Thursday s session at 9, The Index gained some strength through the week and the MACD is now departing zero line upwards, which is a positive for the weeks to come. Our current support level remains at 8,000 points and the resistance at 10,000. DEFINITIONS OF KEY TERMS USED IN TECHNICAL ANALYSIS RSI (Relative Strength Index) indicator RSI is a momentum oscillator that measures the speed and change of price movements. The RSI oscillates between 0 to 100. The index is deemed to be overbought once the RSI approaches the 70 level, indicating that a correction is likely. On the other hand, if the RSI approaches 30, it is an indication that the index may be getting oversold and therefore likely to bounce back. MACD (Moving Average Convergence Divergence) indicator The indicator consists of the MACD line and a signal line. The divergence or the convergence of the MACD line with the signal line indicates the strength in the momentum during the uptrend or downtrend, as the case may be. When the MACD crosses the signal line from below and trades above it, it gives a positive indication. The reverse is the situation for a bearish trend. Candlestick chart A candlestick chart is a price chart that displays the high, low, open, and close for a security. The body of the chart is portion between the open and close price, while the high and low intraday movements form the shadow. The candlestick may represent any time frame. We use a one-day candlestick chart (every candlestick represents one trading day) in our analysis. Doji candlestick pattern A Doji candlestick is formed when a security's open and close are practically equal. The pattern indicates indecisiveness, and based on preceding price actions and future confirmation, may indicate a bullish or bearish trend reversal. Shooting Star/Inverted Hammer candlestick patterns These candlestick patterns have a small real body (open price and close price are near to each other), and a long upper shadow (large intraday movement on the upside). The Shooting Star is a bearish reversal pattern that forms after a rally. The Inverted Hammer looks exactly like a Shooting Star, but forms after a downtrend. Inverted Hammers represent a potential bullish trend reversal. Page 4 of 6

5 Company Name Price February 15 % Change WTD % Change YTD Market Cap. QR Million TTM P/E P/B Div. Yield Qatar National Bank (0.78) , Qatar Islamic Bank , Commercial Bank of Qatar (2.73) 11, N/A Doha Bank , Al Ahli Bank (14.08) 6, Qatar International Islamic Bank , Masraf Al Rayan , Al Khalij Commercial Bank (9.15) 4, Qatar First Bank ,340 N/A 0.8 N/A National Leasing (4.01) Dlala Holding (2.72) N/A Qatar & Oman Investment Islamic Holding Group (16.00) 178 N/A Banking and Financial Services 218,043 Zad Holding (8.64) Qatar German Co. for Medical Devices (6.81) 70 N/A 1.0 N/A Salam International Investment 6.12 (2.08) (11.18) 700 N/A Medicare Group , Qatar Cinema & Film Distribution (2.37) (17.60) Qatar Fuel (0.43) , Widam Food Co (0.73) , Mannai Corp (2.89) , Al Meera Consumer Goods , Consumer Goods and Services 22,809 Qatar Industrial Manufacturing , Qatar National Cement (1.43) , Industries Qatar , Qatari Investors Group (8.47) 4, Qatar Electricity and Water (1.02) , Aamal , Gulf International Services , Mesaieed Petrochemical Holding , Invesment Holding Group N/A Industrials 121,609 Qatar Insurance (10.11) 12, Doha Insurance (0.64) Qatar General Insurance & Reinsurance (3.08) 4, Al Khaleej Takaful Insurance (0.54) (3.32) Qatar Islamic Insurance Insurance 19,035 United Development (0.12) , Barw a Real Estate , Ezdan Real Estate 9.45 (3.08) (21.77) 25, Mazaya Qatar Real Estate Development (10.22) N/A Real Estate 46,747 Ooredoo (1.75) (5.23) 27, Vodafone Qatar (6.36) 6,349 N/A 1.4 N/A Telecoms 33,896 Qatar Navigation (Milaha) (3.05) , Gulf Warehousing (5.93) 2, Qatar Gas Transport (Nakilat) , Transportation 19,280 Qatar Exchange 481,420 Source: Bloomberg Page 5 of 6

6 Contacts Saugata Sarkar, CFA, CAIA Shahan Keushgerian Zaid al-nafoosi, CMT, CFTe Head of Research Senior Research Analyst Senior Research Analyst Tel: (+974) Tel: (+974) Tel: (+974) Mohamed Abo Daff QNB Financial Services Co. W.L.L. Senior Research Analyst Contact Center: (+974) Tel: (+974) PO Box Doha, Qatar Disclaimer and Copyright Notice: This publication has been prepared by QNB Financial Services Co. W.L.L. ( QNBFS ) a wholly-owned subsidiary of Qatar National Bank (Q.P.S.C.). QNBFS is regulated by the Qatar Financial Markets Authority and the Qatar Exchange. Qatar National Bank (Q.P.S.C.) is regulated by the Qatar Central Bank. This publication expresses the views and opinions of QNBFS at a given time only. It is not an offer, promotion or recommendation to buy or sell securities or other investments, nor is it intended to constitute legal, tax, accounting, or financial advice. QNBFS accepts no liability whatsoever for any direct or indirect losses arising from use of this report. Any investment decision should depend on the individual circumstances of the investor and be based on specifically engaged investment advice. We therefore strongly advise potential investors to seek independent professional advice before making any investment decision. Although the information in this report has been obtained from sources that QNBFS believes to be reliable, we have not independently verified such information and it may not be accurate or complete. QNBFS does not make any representations or warranties as to the accuracy and completeness of the information it may contain, and declines any liability in that respect. For reports dealing with Technical Analysis, expressed opinions and/or recommendations may be different or contrary to the opinions/recommendations of QNBFS Fundamental Research as a result of depending solely on the historical technical data (price and volume). QNBFS reserves the right to amend the views and opinions expressed in this publication at any time. It may also express viewpoints or make investment decisions that differ significantly from, or even contradict, the views and opinions included in this report. This report may not be reproduced in whole or in part without permission from QNBFS COPYRIGHT: No part of this document may be reproduced without the explicit written permission of QNBFS. Page 6 of 6