8-May-11 The key to investing is determining the competitive advantage of any given company and, above all, the durability of that advantage. ~Warren Buffett Al Maha EYE Global markets & Commodities Watch GLOBAL NEWS WATCH International Indices Index Value % Change USA Dow Jones 12,638.70 0.43% S&P 500 1,340.20 0.38% NASDAQ 2,827.56 0.46% EUROPE FTSE 100 5,976.77 0.96% CAC 40 4,058.01 1.33% DAX 30 ASIA 7,492.25 1.56% NIKKEI 9,859.20-1.45% Hang Seng 23,159.10-0.44% Strait Times 3,099.52-0.33% Regional Indices Index Value % Change Muscat Stock 6,338.80 0.11% Saudi Arabia 6,577.74-1.57% Dubai 1,607.29-0.68% Abu Dhabi 2,697.56-0.09% Kuwait (Price Index) 6,516.00 0.25% Bahrain 1,393.17-0.22% Qatar 8,452.38-0.48% Commodities Crude Oil ($/bbl) Close % Change Nymex Future 97.18-2.63% Brent 109.85-0.66% WTI 97.18-1.63% Metals Close % Change Gold $/OZ 1,491.60 0.69% Silver $/OZ 35.287-2.63% Aluminum $/T 2,680.00-0.37% Copper $/T 8,790.00-2.44% Nickel $/T 24,970.00-3.10% Forex Cross Currency Rates for Major currencies Currency $ Rs US $ 1.0000 0.0225 1.6362 1.4309 0.0124 Indian Rupees (Rs) 44.4250 1.0000 72.6882 63.5677 0.5506 Sterling ( ) 0.6108 0.0135 1.0000 0.8741 0.0076 Euro ( ) 0.6984 0.0154 1.1427 1.0000 0.0083 Japanese Yen ( ) 80.580 1.7700 131.870 115.370 1.0000 U.S. stocks retreat most since March after global commodity prices slump U.S. stocks fell last week, sending the Standard & Poor s 500 Index to the biggest drop since March, as the largest commodities slump in two years drove down energy and raw - materials producers. The S&P 500 pared its weekly loss on Friday, gaining 0.4 percent after April job growth topped economists estimates. The S&P 500 lost 1.7 percent to 1,340.20 last week, including four straight declines. The Dow fell 171.80 points, or 1.3 percent, to 12,638.74. Energy stocks in the S&P 500 sank 7 percent, the biggest loss among 10 industries and the largest retreat for the group since May 2010. Asia stocks fall, erasing this year s gain, as U.S. economic outlook wanes Asian stocks fell last week, with the regional benchmark index falling by the most in six weeks, as U.S. economic data and plunging commodity prices added to signs the recovery in the global economy is weakening. The MSCI Asia Pacific Index lost 1.4 percent to 137.57 last week. The gauge gained 0.5 percent the previous week. Service industries in the U.S. expanded in April at the slowest pace in eight months as companies cut back in response to higher energy costs, according to the Institute for Supply Management s index of U.S. non-manufacturing companies published on May 4. Applications for jobless benefits unexpectedly jumped by 43,000 to 474,000 in the week ended April 30, the most since August, Labor Department figures showed on May 5. Silver bounces from 12 pct fall, gold inches up Silver rebounded on Friday from its biggest one-day dollar fall since 1980, and gold also recovered as cheaper prices lured in Asian investors. Spot silver slumped by 12 percent on Thursday after another margin hike by the CME Group on its COMEX silver futures increased the cost of the trading the metal, dragging gold down 3 percent. COMEX silver fell more than 5 percent to $34.27 in early trade, before regaining some ground to $35.05. Spot gold rose by more than 1 percent to $1,486.96 an ounce. JP Morgan raises oil price forecasts citing supply woes JP Morgan Chase raised its oil price forecasts because Organisation of Oil Exporting Countries (OPEC) and other producers are not matching rising demand and consumers will take time to react to higher prices. The Bank boosted its 2011 Brent crude forecast to $120 a barrel from $110 and changed its estimate for West Texas intermediate crude to $109.50 from $99. Forecasts for 2012 prices were raised to $120 and $114, respectively. JP Morgan forecasts supply to fall short of demand by 600,000 barrels a day during the third quarter, even with the assumption that the Opec increases output by 1.2 million barrels a day in the coming months. GCC Returns (YTD) Currency Rates against OMR Currency Close % Change OMR/ $ 2.590 0.01% OMR/ 1.582 0.80% OMR/ 1.809 3.67% OMR/ 208.74-0.35% OMR/ Rs 115.08-0.93% Debt market Interest Rates LIBOR EURIBOR 1M 3M 6M 1Y 0.213% 0.274% 0.433% 0.762% 1.250% 1.415% 1.700% 2.157% 2% 0% -2% -4% -6% Muscat Stock -6.16% Saudi Arabia Dubai Abu Dhabi Kuwait (Price Index) -1.15% -1.42% -0.82% -6.32% Bahrain Qatar -2.73% -2.64% Sources: Bloomberg, Reuters, Zawya, MSM Data as on 9.00 AM, 8-May-11-8%
Round up REGIONAL & OMAN NEWS WATCH Al Maha Equity Research - EYE MSM Indices Movement Index MSM 30 Banking & Investments Services &Insurance Industry MSM Sectorial Snapshot Index MSM 30 Banking & Investments Industry Services &Insurance 5-May-11 Last Close Prev. Close Change % Change 6,338.80 6,332.05 6.75 0.11% 7,118.40 7,096.79 21.61 0.30% 2,712.01 2,719.69-7.68-0.28% 6,824.43 6,829.95-5.52-0.08% Mcap (RO Dividend P/E P/BV '000) Yield 5,460,804 11.2 1.7 4% 3,139,920 12.5 1.6 3% 765,052 10.3 1.7 6% 1,555,833 9.5 2.0 6% Net Position Nationality Buy Sell Net Buy / Vol (%) Val (%) Vol (%) Val (%) Sell OMANIS 83.63 % 61.44 % 86.46 % 72.17 % -10.73% GCC 2.77 % 5.98 % 9.41 % 20.08 % -14.10% ARABS 0.44 % 0.98 % 2.52 % 5.14 % -4.16% OTHERS 13.15 % 31.60 % 1.60 % 2.61 % 28.99% MSM Movers Stock Taageer Right Issue Nat. Mineral Water United Power Bank Dhofar Ominvest MSM Shakers Stock National Securities Onic. Holding Oman Fisheries United Finance Renaissance Services MSM Volume Leaders Stock Taageer Right Issue Bank Muscat Ominvest Oman Int. Bk. Oman Inv. & Fin. MSM Value Leaders Stock Close % Change Bank Muscat Ominvest Renaissance Services Omantel Nawras Close % Change Volume 0.030 200.00% 4,048,252 36.92% 0.080 3.90% 61,400 0.56% 1.113 3.54% 13,429 0.12% 0.660 1.70% 10,000 0.09% 0.515 1.58% 861,592 7.86% Close % Change Volume 0.110-4.35% 108,400 0.99% 0.288-1.71% 27,882 0.25% 0.124-1.59% 11,000 0.10% 0.066-1.49% 45,000 0.41% 1.014-0.78% 273,638 2.50% Close % Change Volume 0.030 200.00% 4,048,252 36.92% 0.768-0.52% 1,534,601 14.00% 0.515 1.58% 861,592 7.86% 0.263-0.38% 647,540 5.91% 0.202 1.00% 412,232 3.76% Turnover 0.768-0.52% 1,179,179 34.13% 0.515 1.58% 443,765 12.84% 1.014-0.78% 277,525 8.03% 1.131 0.18% 268,833 7.78% 0.742 0.00% 181,134 5.24% Breadth Advances 14 Declines 11 REGIONAL Dubai economy to rebound: IIF Dubai s economy is set to bounce back with a projected 3.5 per cent growth in 2011 as the turmoil in the Arab world would indirectly boost the UAE overall economy, Institute of International Finance said. UAE growth is expected to accelerate from 2.7 per cent in 2010 to 3.8 per cent in 2011 and to 4.0 per cent in 2012. IIF said the UAE, the second largest Arab economy after Saudi Arabia, would boost its economy through higher production of crude oil in Abu Dhabi, larger revenues due to a spike in oil prices and a diversion to the country of some of the regional trade, transportation, tourism, and finance. OMAN Oman s oil output up 2.7% in first quarter Oman boosted its oil production by around 2.7 per cent year on year in the first quarter of 2011 as the non-opec Gulf country is pushing ahead with a project to expand its hydrocarbon sector, official data showed on Saturday. From around 861,400 barrels per day in the first quarter of 2010, the country s crude production grew to nearly 884,900 bpd in the first quarter of this year, the Omani oil ministry said in a new report. The price of Omani crude jumped to nearly $92.5 a barrel in the first quarter of this year from around $77.04 in the first quarter of 2010. Oman s gas production also edged up by around 1.4 per cent to 2,884 million cubic metres in the first quarter of 2011 from about 2,844 million cubic metres in the first quarter of 2010. Average daily gas output stood at nearly 93 million cubic metres in March compared with 91.7 million cubic metres in the same period of 2010. Oman National Engineering and Investment Company bags tender worth RO 1.8 million The Public Authority for Electricity & Water has awarded Oman National Engineering & Investment Company SAOG the contract for construction of Murati Desalination Plant at Al Wssta for the sum of RO 1.8 million. The project is for a period of nine months. Galfar Engineering & Contracting announces initial results for the quarter ended March 2011 Galfar Engineering & Contracting SAOG reported a net profit of Ro 1.4 million for the quarter ended March 2011 compared to a loss of RO 844 thousand for the same period last year. The Company s Contract and other income amounted to RO 79.5 million for the three months as against RO 89.6 million for the corresponding three months in 2010. MSM Returns (YTD) 2.00% 0.00% -2.00% -4.00% -6.00% -8.00% -10.00% -12.00% -14.00% -6.16% -6.60% 0.23% MSM Banking Industry Services Activity Statistics Traded volume Turnover R.O 10,964,153 3,454,776-16.00% -14.44% Sources:Bloomberg,Reuters,Zawya,MSM
Al Maha Financial Services LLC Al Maha Technical Research MSM General Index 6400 6298 6,338.80 6,400 6,298 6,398 6,499 43 52 MSM General Index ended flat on Thursday's session at 6338.8, with a marginal gain of 0.11% and with volumes of 10.96 million shares traded. continued the flat move last week, recording a marginal positive change of 0.05% while foreign investors stood as net buyers. The interim weakness of the market is likely to continue with the index staying below 25 week's moving average with downward sloping weekly MACD. Ominvest (OMVS) 0.54 0.471 0.515 0.540 0.471 0.489 0.500 64 50 Ominvest closed last trading session at 0.515, gaining 1.58% with relatively high volumes of 0.862 million shares traded on the counter. OMVS shows positive outlook after showing a break out last week from it's wedge pattern, recording a weekly gain of 4.46%. The advancing daily MACD,RSI and ADX point to continuation of the up move for the scrip. Immediate resistance for the stock is likely at 0.540 levels. Source:Tickerchart Al Maha Financial Services LLC
Al Maha Financial Services LLC ` Al Maha Technical Research Renaissance Services (RNSS) 1.04 1 1.014 1.040 1.000 1.036 1.050 40 27 Renaissance Services closed Thursday's session at 1.014 loosing 0.78% with 0.273 million shares traded. RNSS shows a weak structure on charts with it's descending triangle pattern formation and by slipping below 25 week's moving average. However, movements of key indicators on short term charts suggest limited down side for the scrip. 1.000 level continues as a strong support for Renaissance. Bank Dhofar (BKDB) 0.685 0.64 0.660 0.685 0.640 0.657 0.678 38 44 Bank Dhofar ended the previous trading session at 0.660, gaining 1.7% with10 thousand shares changing hands. BKDB demonstrates a flat trend with the sideways movement of momentum indicators. Movements of key trend, directional indicators and lacking volume support at the counter suggest limited probability for a sharp up move for the scrip. The stock is likely to test the immediate resistance at 0.685. Source:Tickerchart Al Maha Financial Services LLC
MSM Corporate Score Sheet Company Price Revenue Net Profit EPS PE Face Cap Result as on (Values in RO '000) 5-May-11 Value Capital FY 2010 Y-o-Y % Y-o-Y % Net Worth BVPS PBV FY 2010 FY10 (FY 10) Change. Change. Banks & Inv. Holding National Bank of Oman 0.311 0.100 108,100 336,191 31-Dec-10 78,100-5% 27,200 29% 0.025 265,810 0.246 12.4 1.3 5% Bank Muscat 0.768 0.100 154,837 1,189,149 31-Dec-10 187,195 7% 101,700 38% 0.066 796,128 0.514 11.7 1.5 3% Ahli Bank 0.280 0.100 80,143 224,401 31-Dec-10 19,364 42% 14,100 65% 0.018 102,106 0.127 15.9 2.2 - Bank Sohar 0.158 0.100 100,000 158,000 31-Dec-10 30,595 34% 10,220 27% 0.010 116,531 0.117 15.5 1.4 4% Bank Dhofar 0.660 0.100 91,524 604,060 31-Dec-10 57,251 16% 33,280 31% 0.036 226,500 0.247 18.2 2.7 2% Oman International Bank 0.263 0.100 96,805 254,596 31-Dec-10 29,839-6% 17,585-18% 0.018 169,103 0.175 14.5 1.5 8% Ominvest 0.515 0.100 25,300 130,295 31-Dec-10 54,122 7% 11,959 5% 0.047 92,625 0.366 10.9 1.4 2% ONIC Holding 0.288 0.100 17,342 49,946 31-Dec-10 2,941 157% 13,119 157% 0.076 52,450 0.302 3.8 1.0 - Al Anwar Holding* 0.103 0.100 12,000 12,360 31-Dec-10 7,251 3% (213) -106% NA 18,480 0.154 NA 0.7 - Oman and Emirates Hldg. 0.142 0.100 12,188 17,306 31-Dec-10 5495 40% 277 115% 0.002 18,359 0.151 NA 0.9 - Oman Inv. & Finance* 0.202 0.100 12,000 24,240 31-Dec-10 15,403-16% 2,442-3% 0.027 18,003 0.150 7.4 1.3 - Financial Services 0.094 0.100 6,500 6,110 31-Dec-10 964-7% (700) -374% NA 7,316 0.113 NA 0.8 - Gulf Inv. Services 0.067 0.100 15,023 10,066 31-Dec-10 1,654-18% 803-18% 0.007 16,495 0.110 NA 0.6 - DIDIC 0.529 0.100 20,000 105,800 31-Dec-10 21,941 360% 18,461 89% 0.123 83,547 0.418 4.3 1.3 8% Global Investment 0.058 0.100 30,000 17,400 31-Dec-10 3,935-30% 695-71% 0.002 36,421 0.117 25.1 0.5 - Aggregate 3139920 516049 250927 2,019,874 12.5 1.55 3% Industry Oman Cement 0.591 0.100 33,087 195,544 31-Dec-10 62,523-13% 24,505 1% 0.074 148,519 0.449 8.0 1.3 6% Raysut Cement 1.083 0.100 20,000 216,600 31-Dec-10 64,978-27% 20,722-28% 0.104 107,459 0.537 10.5 2.0 9% Oman Flour Mills** 0.579 0.100 15,750 91,193 31-Dec-10 23,034 0.2% 3,211-39% 0.041 46,383 0.294 14.2 2.0 - Al Hassan Engineering 0.480 0.100 7,521 36,101 31-Dec-10 60,246 12% 2,710 1% 0.036 15,060 0.200 13.3 2.4 3% Al Anwar Ceramic 0.285 0.100 19,469 55,487 31-Dec-10 17,398 10% 5,353 8% 0.027 23,869 0.123 10.4 2.3 2% Oman Cables 1.005 0.100 8,970 90,149 31-Dec-10 200,900 29% 8,100 21% 0.090 45,043 0.502 11.1 2.0 4% Jazeera Steel Product 0.280 0.100 12,490 34,971 31-Dec-10 64,912 62% 1,903 346% 0.015 31,324 0.251 18.4 1.1 3% Voltamp Energy 0.565 0.100 5,500 31,075 31-Dec-10 13,932 12% 2,442 11% 0.044 15,527 0.282 12.7 2.0 6% National Aluminium 0.415 0.100 3,357 13,932 31-Dec-10 20,981-28% 2,146-15% 0.064 7,283 0.217 6.5 1.9 10% Aggregate 765,052 528,904 71092 440,467 10.3 1.7 6% Services Shell Oman ing 2.395 0.100 10,000 239,500 31-Dec-10 323,604 8% 13,991 7% 0.140 30,331 0.303 17.1 7.9 5% Al Jazeera Services 0.205 0.100 11,172 22,902 31-Dec-10 9,872 15% 1,949-44% 0.017 18,083 0.162 11.7 1.3 10% Renaissance Services 1.014 0.100 28,209 271,280 31-Dec-10 253,429 2% 27,648 10% 0.103 172,318 0.644 9.8 1.6 1% Omantel 1.131 0.100 75,000 848,250 31-Dec-10 416,600 1% 112,000 6% 0.149 458,959 0.612 7.6 1.8 9% Oman Fisheries* 0.124 0.100 12,500 15,500 31-Dec-10 14,185 51% 1,091-25% 0.012 16,716 0.134 10.7 0.9 - Galfar Engineering 0.480 0.100 33,000 158,400 31-Dec-10 371,851 11% 5,906 57% 0.018 83,452 0.253 26.8 1.9 0% Aggregate 1,555,833 162585 779,860 9.5 2.0 6% MSM-30 5,460,804 484,604 35% 3,240,201 11.2 1.7 4% Others Dhofar Insurance 0.189 0.100 20,000 37,800 31-Dec-10 53,811-8% 3,037-14% 0.015 32,371 0.162 12.4 1.2 5% Oman Oil ing 1.376 0.100 6,450 88,752 31-Dec-10 216,200 28% 6,900 29% 0.107 28,742 0.446 12.9 3.1 3% Oman United Insurance 0.132 0.100 10,000 13,200 31-Dec-10 20,994 4% 2,788-27% 0.028 20,287 0.203 4.7 0.7 11% Port Services Corp. 0.510 0.100 9,504 48,470 31-Dec-10 19,139 3% 5,599 4% 0.059 35,730 0.376 8.7 1.4 11% ACWA Power Barka 1.300 0.500 16,000 41,600 31-Dec-10 40,210 0% 8,078 0% 0.252 31,012 0.969 5.1 1.3 7% Taageer Finance 0.135 0.100 12,667 17,100 31-Dec-10 8,945 2% 2,465 12% 0.019 19,744 0.156 6.9 0.9 5% Dhofar Cattlefeed 0.126 0.100 7,700 9,702 31-Dec-10 22,523 3% 5611 541% 0.073 40,156 0.522 1.7 0.2 - Majan Glass 0.600 0.100 3,322 19,932 31-Dec-10 9,846-7% 2,751-11% 0.083 13,158 0.396 7.2 1.5 7% Oman Chlorine 0.366 0.100 5,883 21,532 31-Dec-10 5,878 7% 2,557 3% 0.043 13,955 0.237 8.4 1.5 1% Construction Material 0.060 0.100 8,500 5,100 31-Dec-10 3,377 11% 114-78% 0.001 8,807 0.104 44.7 0.6 - Salalah Mills 0.850 0.100 4,125 35,063 31-Dec-10 29,199 7% 3,675 2.9% 0.089 13,446 0.326 9.5 2.6 4% Nawras 0.742 0.100 65,094 482,997 31-Dec-10 188,900 10% 50,000 20% 0.077 143,308 0.220 9.7 3.4 5% * FY March.** FY June Source:MSM Note : PBV based on the latest available Financial Statements Al Maha Equity Research - EYE Dividend Yield (FY 10)
Al Maha Equity Research - EYE PO Box 1065 PC 117, Al Wadi Al Kabir, Sultanate of Oman Contacts Telephone e-mail Research: Suresh Kumar 24827137 suresh@almahafinancial.com Radhika Gadhia 24827138 radhika@almahafinancial.com Khushboo Badlani 24827140 khushboo@almahafinancial.com Institutional Sales: A. S. Kedarnath 24827181 kedar@almahafinancial.com Steven Noronha 24827129 steven@almahafinancial.com Brokerage: Abdullah Al Hinai 24827188 abdullah@almahafinancial.com Mahmoud Al Hamsaidi 24827144 mahmoud@almahafinancial.com Nasser Al Banna 24827177 nasser@alamahfinancial.com Disclaimer The information contained in this report has been obtained from the sources believed to be reliable and in good faith, but which may not be verified independently. While utmost care has been taken in preparing the above report, Al Maha Financial Services LLC makes no guarantee, representation or warranty, whether expressed or implied, and accepts no responsibility or liability to its accuracy and completeness of the data, being provided. Opinion expressed is our current opinion as of the date appearing on this material only. We do not undertake to advise you as to any change of our views expressed in this document. The investments discussed in this report may not be suitable for all the investors. Investors must take their own decision based on their specific investment objectives and financial position, and using such independent advisors, as they believe necessary. Income from investments may fluctuate. The price or value of the investments, to which this report relates, either directly or indirectly, may fall against the interest of investors. This document is strictly for the use of recipients only. None of the material provided herein may be reproduced, rewritten, rehashed, published, resold or distributed in any manner whatsoever without the prior and explicit written permission of