MIDEAST STOCKS-Industries Qatar hits 9-yr high on dividend; region mixed

Mon Feb 17, 2014 8:22am EST

Related Topics

* Qatari conglomerate lifts bourse with generous dividend

* Saudi petrochemicals retreat in profit-taking

* Dubai firms rise on Q4 eranings bets

By Nadia Saleem

DUBAI, Feb 17 (Reuters) - Blue chip Industries Qatar surged to a nine-year high on Monday as a surprise hike in dividends attracted buyers even though the firm's fourth-quarter profit trailed estimates.

Industries Qatar boosted Doha's measure while other regional markets were mixed.

Shares in the metals and petrochemicals conglomerate jumped 7.4 percent to 193.10 riyals, their highest since April 2005.

The firm's board proposed a dividend of 11 riyals per share or 110 percent of its nominal value, up from 8.5 riyals in 2012. Qatar's bourse is up 1.5 percent.

The dividend hike comes despite a 5 percent drop in annual profit due to weak fertiliser prices.

"We see the company as well positioned to maintain a payout ratio greater than 80% in the medium-to-long-term driven by lower leverage and limited announced capex," Ankit Gupta, assistant vice president of research at NBK Capital, said in a note.

NBK Capital's fair value for the stock is 162.5 riyals and Gupta expects some increase in the fair value on 2013 dividends beat, and improved dividend outlook in the medium term.

Qatar's benchmark rose 1.5 percent, its biggest one-day gain in six weeks, to hit a 67-month high.

Dividends in the Gulf region have helped boost share prices more than positive earnings and in IQ's case, even offset weak earnings.

Strong dividend and bonus share payouts by Saudi banks have also spurred investor confidence in recent weeks but the index slipped 0.3 percent in profit-taking on Monday.

Petrochemical sector was the main culprit. Saudi Basic Industries Corp (SABIC) shed 0.9 percent and the sector's index lost 0.8 percent.

Banking shares index was little changed after gaining 5.7 percent so far in 2014.

In the United Arab Emirates, bourses were mixed with Dubai extending gains as the index climbed 0.8 percent to a new five-year high, boosted by a renewed real estate and tourism boom in the emirate.

Shares in Emaar Properties advanced 1.2 percent ahead of the firm posting estimate-beating fourth-quarter profit, which surged 48 percent.

Emaar made a profit of 756 million dirhams ($206 million), well above the average estimate of 622 million dirhams.

Shares in telecommunications firm du and budget carrier Air Arabia also gained as investors made their bets before the announcement of fourth-quarter results.

Abu Dhabi's measure slipped 0.2 percent after touching a multi-year intraday high of 4,920 points.

MONDAY'S HIGHLIGHTS

QATAR

* The index rose 1.5 percent to 11,724 points.

SAUDI ARABIA

* The index slipped 0.3 percent to 8,940 points.

DUBAI

* The index climbed 0.8 percent to 4,224 points.

ABU DHABI

* The index slipped 0.2 percent to 4,880 points.

EGYPT

* The index ended flat at 7,577 points.

OMAN

* The index retreated 0.4 percent to 7,151 points.

KUWAIT

* The index slipped 0.5 percent to 7,794 points.

BAHRAIN

* The index rose 0.7 percent to 1,333 points. (Editing by Olzhas Auyezov)

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