UPDATE 2-Industries Qatar Q3 net profit falls 55 pct

* Q3 profit $321 mln, slightly beats analyst forecasts

* Shares end 1.3 percent higher on Doha bourse

* Shuaa analyst sees revs rising on steel, petrochemicals (Adds analyst note, paragraphs 7-9; closing price)

By John Irish

DUBAI, Oct 14 (Reuters) - Industries Qatar's IQCD.QA net profit fell 55 percent in the third quarter, slightly better than expected amid a petrochemicals downturn that has also hit rivals, Reuters calculations showed on Wednesday.

The company, Qatar's largest by market value, made a net profit of 1.17 billion riyals ($321.3 million) in the quarter, according to Reuters calculations, down from 2.58 billion a year earlier. Analysts, on average, had expected a net profit of 1.08 billion, according to a Reuters poll. [ID:nL4509710]

Industries Qatar, whose operations range from petrochemicals to metals, did not publish quarterly figures but said net profit reached 3.8 billion riyals in the first nine months of the year. Reuters calculated the third quarter based on previous financial statements.

The company's shares ended 1.3 percent higher on the Doha bourse.

The downturn -- blamed on weaker commodity prices, new capacity in the Middle East and a decline in U.S. demand -- has hit other companies in the sector, with Saudi Arabia Fertilisers Co 2020.SE (Safco), for instance, seeing third-quarter profit plummet nearly 75 percent.

Safco is 42.9 percent owned by Saudi Basic Industries Corp 2010.SE, which itself is expected to see a 58.7 percent drop in third-quarter profit, based on the average of estimates by four analysts. [ID:nL4477255]

Investment bank Shuaa Capital said in a note that Industries Qatar's future revenue may be helped by an expected increase in demand for steel and its higher capacity to produce fertilisers and petrochemicals.

"(A move to raise steel prices) indicates that the company foresees an increase in local steel demand, which along with the new set of prices should reflect positively on IQ's Q4 09 steel turnover and results," Shuaa said.

"... upcoming fertilisers and petrochemicals capacity additions should have a positive impact on IQ's revenues in the medium term, conditional on recovered global demand and a higher pricing environment," it added.

Industries Qatar's fertilisers unit this month awarded Italy's Saipem (SPMI.MI) and South Korea's Hyundai Engineering and Construction (000720.KS) a contract to build a new fertiliser plant in the country.

EFG-Hermes, which has a short-term "neutral" rating on Industries Qatar, said it remained positive on fertiliser price estimates for 2010 but was cautious on global ethylene, given capacity expansion in the Middle East as well as expected increases in China through 2011. (Additional reporting by Firouz Sedarat; Editing by Steve Orlofsky)