Saudi Economic Chartbook

Transcription

1 Saudi Economic Chartbook Third Quarter 218 Hans-Peter Huber, PhD Chief Investment Officer Riyad Capital 6775 Takhassusi St. Olaya Riyadh

2 Third Quarter 218 Oil and Non-Oil Sector Contributing to Overall Growth in 218 The recovery of the Saudi economy in Q1 218 was entirely due to the oil sector. However, with growing signs of a recovery of the non-oil sector and the expected oil output expansion in H2 218 both the oil- and the Non-oil sector will positively contribute to overall growth acceleration in 218. The Saudi fiscal balance witnessed only a marginal deficit in Q This can primarily be explained by significantly higher fiscal revenues due to elevated oil prices and the impact of the recently introduced fiscal reform measures. On the back of this favorable revenues trend, fiscal expenditure is expected to be expansionary throughout 218. Overall inflation remains subdued despite the cost-push impact of the fiscal reform measures at the beginning of 218. This lack of inflationary pressure points towards a still negative output gap in the Saudi Non-oil economy. Table of Contents: GDP Data.. 2 Monetary and Financial Indicators. 3 Fiscal Balance and Government Debt. 6 Private Spending and Foreign Trade... 7 Saudi Arabia has started to gradually increase its crude output by mid-year. Exports of crude and refined products, however, already picked up much earlier (see figure below). Meanwhile, oil prices for Brent quality are trading in the 7-8 USD range since March 218. Despite the most recent Emerging Markets currency turmoil, the USD/SAR-FX forward premium remains unaffected at historically low levels, thereby illustrating the underlying strength of the currency peg at this juncture. TASI continued its rally, which had started in December 217, reaching a multi-year high of almost 85 by mid-july, before some profit taking kicked in during August, partly triggered by a general correction in global Emerging Markets. Saudi Crude Oil Production and Oil Product Exports Non-Oil Business Climate Indicators Inflation Indicators... 9 Real Estate Market... 1 Oil Market Foreign Exchange and Interest Rates Saudi Balance of Payments...15 Saudi Equity Market Facts and Figures at a Glance /12 7/13 7/14 7/15 7/16 7/17 7/18 Saudi crude oil production, in 1bd, l.h.sc. Saudi exports of crude and refined products, in 1bd, r.h.sc. After the latest OPEC agreement Saudi Arabia has started to increase its crude output. Exports of crude oil and refined products, however, picked up much earlier. source: JODI, Bloomberg Page 1

3 Third Quarter 218 Gross Domestic Product (GDP) Overall Economy and Institutional Sectors Real GDP Overall Economy and Oil Sector 15. Nominal and Real GDP Non-Oil Private Sector Q1/12 Q1/13 Q1/14 Q1/15 Q1/16 Q1/17 Q1/18 Real GDP growth Overall economy, quarterly % yoy Real GDP growth Oil-sector, quarterly % yoy -2. Q1/12 Q1/13 Q1/14 Q1/15 Q1/16 Q1/17 Q1/18 Real GDP growth Non-oil private sector, quarterly % yoy Nominal GDP growth Non-oil private sector, quarterly % yoy Monthly GDP Tracker of Overall Economy /12 6/13 6/14 6/15 6/16 6/17 6/18 Real GDP growth Overall economy, quarterly, %yoy Real GDP growth Tracker Overall economy, monthly, %yoy, RC In Q1 218 Saudi real GDP growth recovered to +1.2% yoy. This was entirely due to a rebound of the oil sector (+.6%), while Non-oil private sector growth slowed down to 1.1% (from 1.9% in Q4 GDP Deflator and CPI Inflation Q1/12 Q1/13 Q1/14 Q1/15 Q1/16 Q1/17 Q1/18 GDP deflator Non-oil private sector % yoy CPI inflation % yoy 217). According to our GDP Tracker model the overall economy is expected to further pick up in Q2 218 with both the Non-oil and the oil sector positively contributing to this growth acceleration. Page 2

4 Third Quarter 218 Monetary Aggregates, Credit and Commercial Banks Deposits Growth Rate Monetary Base and Aggregate M1 25 Growth Rate Monetary Aggregates M2 and M /12 6/13 6/14 6/15 6/16 6/17 6/18 Monetary base, % yoy Aggregate M1, % yoy -1 6/12 6/13 6/14 6/15 6/16 6/17 6/18 Aggregate M3, % yoy Aggregate M2, % yoy Growth of Credit to the Private Sector Growth of Commercial Banks Deposits /12 6/13 6/14 6/15 6/16 6/17 6/18 Banks claims on private sector, % yoy, l.h.sc. Banks claims on private sector, % mom, r.h.sc. Growth of the broader monetary aggregates M2 and M3 is stalling by mid-year 218. This can be explained by stagnating customer deposits at commercial banks over this period. Partly, this is due to /12 6/13 6/14 6/15 6/16 6/17 6/18 Banks overall customer deposits, % yoy, l.h. sc. Banks overall customers deposits, % mom, r.h.sc. monetary policy intervention by SAMA in H1 218 shifting government deposits from commercial banks to its own balance sheet in an effort to push SAIBOR rates above USD LIBOR rates. Page 3

5 Third Quarter 218 Commercial Banks Key Ratios Private Sector Loan-Deposit-Ratio 95. Government Sector Loan-Deposit-Ratio /12 6/13 6/14 6/15 6/16 6/17 6/18 Claims on the private sector as % of total bank deposits 4. 6/12 6/13 6/14 6/15 6/16 6/17 6/18 Claims on the government as % of total bank deposits Foreign Assets to Total Assets Ratio 16. Excess Liquidity to Total Assets Ratio /12 6/13 6/14 6/15 6/16 6/17 6/18 Gross foreign assets as % of total assets Net foreign assets as % of total assets The private sector loan-deposit-ratio (LDR) increased in Q2 218 to an average of 89. after 87. in the previous quarter. This is the result of a gradual private sector credit growth on the one hand and. 6/12 6/13 6/14 6/15 6/16 6/17 6/18 Excess liquidity as % of total assets (Excess liquidity = banks current and other deposits at SAMA + SAMA bills) stagnating customer deposits on the other. Meanwhile, the government sector LDR marginally climbed from 19.4 to 2.2 in Q2 218 due to only limited local borrowing by the government. Page 4

6 Third Quarter 218 SAMA Balance Sheet: Key Elements of Assets and Liabilities Foreign Currency Reserves at SAMA Government Deposits at SAMA 2, , , , , 1-5 1, ,6-1 6/12 6/13 6/14 6/15 6/16 6/17 6/18 Total foreign currency reserves at SAMA, in bln SAR, l.h.sc. Monthly change in foreign currency reserves at SAMA, in bln SAR, r.h.sc. Breakdown of Foreign Currency Reserves at SAMA /12 6/13 6/14 6/15 6/16 6/17 6/18 Total government deposits at SAMA, in bln SAR, l.h.sc. Monthly change in total government deposits at SAMA, in bln SAR, r.h.sc. Government Deposits at Commercial Banks 2, , , , /12 6/13 6/14 6/15 6/16 6/17 6/18 Investments in foreign securities, in bln SAR Foreign currencies & deposits abroad, in bln SAR SAMA foreign reserves further increased in Q2 218 by 49bln SAR to 1899bln SAR after a temporary low at 182bln SAR in Q3 217 This increase was primarily reflected in higher SAMA deposits abroad /12 6/13 6/14 6/15 6/16 6/17 6/18 Government and gov. institutions deposits at commercial banks, in bln SAR, l.h.sc. Monthly change in governmental deposits at commercial banks, in bln SAR, r.h.sc. Meanwhile, SAMA reduced the government and government institutions deposits at commercial banks by 52 bln SAR from December 217 to May 218 to tighten liquidity in order to push up SAIBOR rates. Page 5

7 Third Quarter 218 Quarterly Fiscal Balance and Outstanding Government Debt Quarterly Fiscal Revenues (in bln SAR) Quarterl Fiscal Expenditure (in bln SAR) Q1/16 Q2 Q3 Q4 Q1/17 Q2 Q3 Q4 Q1/18 Q Q1/16 Q2 Q3 Q4 Q1/17 Q2 Q3 Q4 Q1/18 Q2 Oil revenues Non-oil revenues Employee compensation (salaries & wages) Other current expenditure Capital expenditure source: MoF source: MoF Quarterly Fiscal Deficit/Surplus (in bln SAR) Outstanding Government Debt (End of Quarter) Q1/16 Q2 Q3 Q4 Q1/17 Q2 Q3 Q4 Q1/18 Q2 Net deficit/surplus source: MoF Q1/16 Q2 Q3 Q4 Q1/17 Q2 Q3 Q4 Q1/18 Q2 Outstanding local government debt, in bln SAR Outstanding foreign government debt, in bln SAR source: MoF In Q2 218 the fiscal budget was almost balanced with a marginal deficit of -7 bln SAR. This was primarily due to significantly higher fiscal revenues compared to Q2 217 (+67%). Elevated oil prices and the impact of the fiscal reform measures can explain this jump in fiscal revenues. On the expenditure side, the increase of 34% to Q2 217 is primarily attributed to sharply higher current spending. Page 6

8 Third Quarter 218 Private Spending Indicators and Non-Oil Foreign Trade Point-of-Sales Transactions 4 ATM Transactions /12 6/13 6/14 6/15 6/16 6/17 6/18 Point-of-sales transactions, % yoy 3-Months Moving Average, % yoy -3 6/12 6/13 6/14 6/15 6/16 6/17 6/18 ATM withdrawals, % yoy 3-Months Moving Average, % yoy Growth of Non-Oil Exports 6 Growth of Imports /12 6/13 6/14 6/15 6/16 6/17 6/18 Non-Oil exports, % yoy 3-Months Moving Average, % yoy Point-of-sales transactions and ATM transactions are generally in recovery mode after some weakness in Q The slump in the June data can primarily be explained by a seasonality factor as Ramadan and -4 6/12 6/13 6/14 6/15 6/16 6/17 6/18 Imports, % yoy 3-Months Moving Average, % yoy Eid holidays usually impact consumer spending. Non-oil exports continue to positively contribute to economic growth broadly stabilizing around a 2% nominal growth rate compared to the previous year. Page 7

9 Third Quarter 218 Non-Oil Private Sector Business Climate Indicators Purchasing Manager Index Composite 64 Purchasing Manager Index Output /12 7/13 7/14 7/15 7/16 7/17 7/18 Emirates NBD PMI Composite 6-Months Moving Average source: Markit 54 7/12 7/13 7/14 7/15 7/16 7/17 7/18 Emirates NBD PMI Output 6-Months Moving Average source: Markit Purchasing Manager Index New Orders 72 Purchasing Manager Index Output Prices /12 7/13 7/14 7/15 7/16 7/17 7/18 Emirates NBD PMI New Orders 6-Months Moving Average source: Markit Purchasing Manager Indices as a proxy for the business climate of the Non-oil economy finally recovered from their sharp slowdown in Q The sub-index for New Orders witnessed a particularly 46 7/12 7/13 7/14 7/15 7/16 7/17 7/18 Emirates NBD PMI Output Prices 6-Months Moving Average source: Markit strong rebound in Q2 218 pointing towards a pickup in future production. Meanwhile, output prices remain stable indicating that there is no inflationary pressure in the Non-oil economy at this juncture. Page 8

10 Third Quarter 218 Consumer and Wholesale Price Inflation Consumer Price Inflation All Items 5. Consumer Price and Wholesale Price Inflation /12 6/13 6/14 6/15 6/16 6/17 6/18 CPI inflation, % yoy CPI inflation, % yoy WPI inflation, % yoy CPI Inflation Food & Housing /13 6/14 6/15 6/16 6/17 6/18 CPI Inflation Furnishings & Transportation /13 6/14 6/15 6/16 6/17 6/18 CPI inflation, sub-index Food and beverages, % yoy CPI inflation, sub-index Housing, water, electricity, gas and other fuels, % yoy CPI inflation, sub-index Furnishings, household equipment & maintenance, % yoy CPI inflation, sub-index Transport, % yoy After the jump in January due to the introduction of the new VAT and the energy price increases, the CPI inflation has gradually declined again towards the 2% mark. This illustrates that besides this costpush inflation impact at the beginning of the year there is no inflationary pressure in the Non-oil private sector which points towards a still negative output gap in the Saudi Non-oil economy. Page 9

11 Third Quarter 218 Real Estate Market: Transaction Activity Quarterly Real Estate Transactions Overall Country 2 Quarterly Residential Real Estate Transactions Q2/11 Q2/12 Q2/13 Q2/14 Q2/15 Q2/16 Q2/17 Q2/18 Total value of quarterly transactions, %yoy Number of quarterly transactions, %yoy source: MOJ, RC -5 Q2/11 Q2/12 Q2/13 Q2/14 Q2/15 Q2/16 Q2/17 Q2/18 Total value of quarterly transactions, %yoy Number of quarterly transactions, %yoy source: MOJ, RC Quarterly Commercial Real Estate Transactions Breakdown of Transaction Value by Regions (Q2 218) % % 14.3% 5-5 Q2/11 Q2/12 Q2/13 Q2/14 Q2/15 Q2/16 Q2/17 Q2/18 Total value of quarterly transactions, %yoy Number of quarterly transactions, %yoy 31.1% Riyadh Region Makkah Region Eastern Region All Other Regions source: MOJ, RC The Saudi real estate market activity in Q2 218 remains substantially below its corresponding previous-year period as already witnessed in the first quarter 218. In terms of total value of transactions source: MOJ, RC this contraction amounts to -31%, in terms of number of transactions the negative growth rate is -15%. This negative trend can equally be observed for residential and commercial real estate activities. Page 1

12 Third Quarter 218 Real Estate Market: Price Indices Residential and Commercial Price Indices 15 Residential and Commercial Land Price Indices Q2/14 Q2/15 Q2/16 Q2/17 Q2/18 Residential price index Commercial price index 75 Q2/14 Q2/15 Q2/16 Q2/17 Q2/18 Residential land price index Commercial land price index Residential Villas and Apartments Price Indices 15 Commercial Shops and Centers Price Indices Q2/14 Q2/15 Q2/16 Q2/17 Q2/18 8 Q2/14 Q2/15 Q2/16 Q2/17 Q2/18 Residential villas price index Residential apartments price index Saudi real estate prices continue to be under pressure in Q However, the general price decline has recently softened somewhat. While residential real estate prices dropped on average by -5.% in Commercial centers price index Commercial shops & galleries price index 216 and -6.3% in 217, they declined by a marginal -1.3% in Q2 218 compared to Q Commercial real estate prices corrected by -2.6% in Q2 218 after -8.6% in 216 and -9.4% in 217. Page 11

13 Third Quarter 218 Oil Market Statistics: Production, Exports, Refinery and Prices Saudi Crude Oil Production and Exports 11 Saudi Crude Refinery Output and Exports /12 7/13 7/14 7/15 7/16 7/17 7/18 Saudi Arabian crude oil production, in 1 bd. Saudi Arabian crude oil export, in 1 bd. source: JODI, Bloomberg 6/12 6/13 6/14 6/15 6/16 6/17 6/18 Saudi Arabian total oil refinery output in 1 bd. Saudi Arabian total oil refinery export, in 1 bd. source: JODI OPEC Crude Output 34 Oil Prices /11 7/12 7/13 7/14 7/15 7/16 7/17 7/18 OPEC crude oil production, in 1 bd 2 8/14 8/15 8/16 8/17 8/18 Brent oil price WTI oil price source: JODI, Bloomberg After the latest OPEC agreement to expand production, Saudi Arabia increased its crude output in June by 46k bd to almost 1.5mbd. Based on preliminary estimates, the July production was gradually lower at 1.3mbd. By contrast, exports of crude oil and refined products had already started to rise by mid of last year. Meanwhile, Brent oil prices trade in the 7-8USD range since March 218. Page 12

14 Third Quarter 218 Foreign Exchange: Forward Rates and Effective Exchange Rate Index 12-Months Forward Exchange Rate SAR/USD 3.85 SAR Nominal and Real Effective Exchange Rate /13 8/14 8/15 8/16 8/17 8/18 12-months forward exchange rate USD/SAR 12-Months Forward Exchange Rate SAR/USD in the Long Term /13 8/14 8/15 8/16 8/17 8/18 SAR Real (CPI-adjusted) trade-weighted exchange rate index SAR Nominal trade-weighted exchange rate index, JP Morgan SAR Nominal and Real Effective Exchange Rate in the Long Term months forward exchange rate USD/SAR Despite the most recent Emerging Market currencies turmoil the USD/SAR-FX-forward premium remains unaffected at historically low levels, illustrating the underlying strength of the SAR currency peg SAR Real (CPI-adjusted) trade-weighted exchange rate index SAR Nominal trade-weighted exchange rate index, JPMorgan at this juncture. Against the backdrop of the recent USD appreciation which started in March 218, the nominal and real effective SAR exchange rate notably strengthened each by about 6%. Page 13

15 Third Quarter 218 Interest Rates: Money Market, Capital Market and Central Bank Rates 3-Months SAIBOR vs. USD LIBOR /13 8/14 8/15 8/16 8/17 8/18 3-months SIBOR SAIBOR (Saudi Interbank Offered Rate) 3-months US LIBOR (London Interbank Offered Rate) 5-Year Swap Rate SAR vs. USD /13 8/14 8/15 8/16 8/17 8/18 5-year Swap rate SAR 5-year Swap rate USD KSA USD-Bonds Yield Spread to US Treasuries 5.5 Central Bank Rate and 3-Months SAIBOR /16 2/17 5/17 8/17 11/17 2/18 5/18 8/18 Maturity 246 Maturity 226 Maturity 221 Due to some liquidity tightening by SAMA in the first half 218 the SAIBOR rate is again by about 3bp above USD LIBOR rate. Both SAIBOR and LIBOR rates are forecasted to further rise until yearend on Reverse repo rate SAMA 3-months SAIBOR (Saudi Interbank Offered Rate) SAMA official repo rate the back of another two rate hikes by the FED and correspondingly by SAMA. This will further flatten the yield curve in USD and SAR as the 5-year Swap rates are not expected to rise to the same extent. Page 14

16 Third Quarter 218 Saudi Balance of Payments Current Account Balance 2 Foreign Workers Remittances Q1/12 Q1/13 Q1/14 Q1/15 Q1/16 Q1/17 Q1/18 Current account balance, quarterly in bln SAR -4 Q1/12 Q1/13 Q1/14 Q1/15 Q1/16 Q1/17 Q1/18 Foreign workers remittances, quarterly in bln SAR (remittances outflow as part of Current account balance) Financial Account Balance Contribution to Balance of Payments Q1/12 Q1/13 Q1/14 Q1/15 Q1/16 Q1/17 Q1/18 Financial account balance (excluding changes in foreign reserve assets), quarterly in bln SAR (+ capital inflows, - capital outflows) -2-2 Q1/12 Q1/13 Q1/14 Q1/15 Q1/16 Q1/17 Q1/18 Current account balance Errors & omissions Financial account balance Net change in foreign reserve assets The current account balance showed a surplus for the third time in a row in Q This is primarily the result of substantially higher oil export revenues over this period. This surplus was marginally outpaced by a corresponding deficit in the financial account balance in the same period. Hence, the balance of payment (i.e. net change in foreign reserve assets) witnessed a small deficit in Q Page 15

17 Third Quarter 218 Tadawul: Saudi Equity Market Statistics Tadawul All-Share Index /15 2/16 8/16 2/17 8/17 2/18 8/18 Tadawul All-share index 1-Weeks Moving Average Tadawul Total Trading Value /15 1/16 7/16 1/17 7/17 1/18 7/18 Average daily trading value for Tadawul, in mln SAR source: Tadawul Weekly Net Purchase by Ownersip (in bln SAR) Weekly Net Purchase by Ownersip (in bln SAR) 1 in bln SAR 1 in bln SAR /16 11/16 2/17 5/17 8/17 11/17 2/18 5/18 8/18 Retail Corporates Government related entities (GRE) source: Tadawul -6 8/16 11/16 2/17 5/17 8/17 11/17 2/18 5/18 8/18 Mutual funds High Net Worth Individuals total (HNWI and IPI) Foreign investors total (incl. GCC) source: Tadawul TASI continued its rally, which had started in December 217, reaching a multi-year high of almost 85 by mid-july before some profit taking kickedin during August which was also triggered by a notable correction in global Emerging Markets. Trading volumes declined during the summer months to an average daily traded value of about 3bln SAR after having reached a peak in April at almost 5bln SAR. Page 16

18 Third Quarter 218 Tadawul: Saudi Equity Market Statistics Performance TASI Sectors July 218YTD Media Banks Telco Services Energy Materials TASI Food & Staples Retailing Pharma, Bio & LS Retailing Commercial & Prof. Svc Healthcare Equip&Svc Transportation Diversified Financials Consumer Durables & App. Consumer Services Utilities Food & Beverages Capital Goods REITS Insurance Real Estate Performance in % YTD, including dividends Quarterly Earnings TASI Q2/1 Q2/11 Q2/12 Q2/13 Q2/14 Q2/15 Q2/16 Q2/17 Q2/18 TASI quarterly EPS in SAR, l.h.sc TASI 4Q trailing EPS in SAR, r.h.sc. Valuation TASI: PE-Ratio Trailing 26 Valuation TASI: PE-Ratio Forward /8 8/1 8/12 8/14 8/16 8/18 PE ratio TASI, 12-months trailing earnings Long-term average The corporate earnings recovery continued into the 2 nd quarter 218. Meanwhile, the 4-quarter trailing EPS for TASI has rebounded to 455 SAR after a low at 41 SAR in Q This most recent earnings 6 8/8 8/1 8/12 8/14 8/16 8/18 PE ratio TASI, 12-months forward earnings Long-term average recovery also provides some relief at the valuation front. Trailing and forward PE-ratios have declined towards their long-term average as a result of better earnings and the most recent market correction. Page 17

19 Third Quarter 218 Economic Facts and Figures at a Glance GDP and Fiscal Indicators f 219f Real GDP Growth Overall economy Non-oil Private sector Government sector Oil sector Fiscal Balance and Government Debt Fiscal Balance in bln SAR Fiscal Balance in % GDP Government debt in bln SAR Government debt as % GDP , MOF, RC Oil, Inflation and Interest Rates f 219f Oil Prices and Production (yearly average) Brent price (USD pb) WTI price (USD pb) OPEC Basket price (USD pb) KSA oil production (mln bd) Inflation and Interest Rates (year end) CPI Inflation (yearly average) M SIBOR SAR Reverse Repo Rate Official Repo Rate , SAMA, RC External Balance f 219f Trade and Current Account Trade Balance in bln SAR Trade Balance in % GDP Current Account in bln SAR Current Account in % GDP , RC Tadawul Equity Market Key Figures (period end) f 219f Total Return in % n.a. n.a. P/E-ratio P/B-ratio RoE P/E-ratio = Price/ Earnings-ratio, P/B-ratio = Price / Book-ratio all ratios on trailing basis except 218, 219 forecasts (consensus forward-ratios) Global Economy GDP Growth Rates f 219f World Advanced Economies USA Euro Area Japan United Kingdom Emerging Market Economies China India Russia Brazil We expect the Saudi economy to grow by +2.5% in 218 and by +2.8% in 219. This rebound is the combined result of a recovery of the Non-oil economy as well as an expected output expansion of the oil sector. Fiscal policy will remain expansionary on the back of substantially higher fiscal revenues as a result of higher oil prices and the recently introduced fiscal reform measures. Overall, the budget deficit will shrink distinctly below its budgeted target of 195 bln SAR. Based on the latest outlook of the IMF, global economic growth will accelerate to 3.9% in 218 after 3.7% in 217. This growth acceleration will primarily be driven by the US and some Emerging Economies. source: IMF Page 18

20 Third Quarter 218 Disclaimer The information in this report was compiled in good faith from various public sources believed to be reliable. Whilst all reasonable care has been taken to ensure that the facts stated in this report are accurate and that the forecasts, opinions and expectations contained herein are fair and reasonable, Riyad Capital makes no representations or warranties whatsoever as to the accuracy of the data and information provided and, in particular, Riyad Capital does not represent that the information in this report is complete or free from any error. This report is not, and is not to be construed as, an offer to sell or solicitation of an offer to buy any financial securities. Accordingly, no reliance should be placed on the accuracy, fairness or completeness of the information contained in this report. Riyad Capital accepts no liability whatsoever for any loss arising from any use of this report or its contents, and neither Riyad Capital nor any of its respective directors, officers or employees, shall be in any way responsible for the contents hereof. Riyad Capital or its employees or any of its affiliates may have a financial interest in securities or other assets referred to in this report. Opinions, forecasts or projections contained in this report represent Riyad Capital's current opinions or judgment as at the date of this report only and are therefore subject to change without notice. There can be no assurance that future results or events will be consistent with any such opinions, forecasts or projections which represent only one possible outcome. Further such opinions, forecasts or projections are subject to certain risks, uncertainties and assumptions that have not been verified and future actual results or events could differ materially. The value of, or income from, any investments referred to in this report may fluctuate and/or be affected by changes. Past performance is not necessarily an indicative of future performance. Accordingly, investors may receive back less than originally invested amount. This report provide information of a general nature and do not address the circumstances, objectives, and risk tolerance of any particular investor. Therefore, it is not intended to provide personal investment advice and does not take into account the reader s financial situation or any specific investment objectives or particular needs which the reader s may have. Before making an investment decision the reader should seek advice from an independent financial, legal, tax and/or other required advisers. This research report might not be reproduced, nor distributed in whole or in part, and all information; opinions, forecasts and projections contained in it are protected by the copyright rules and regulations. Riyad Capital is a Saudi Closed Joint Stock Company with a paid up capital of SR 2 million, with commercial registration number ( ), licensed and organized by the Capital Market Authority under License No. (77-37), Head Office: 6775 Takhassusi Street Olaya, Riyadh , Saudi Arabia ( KSA ). Website: Page 19