Kuwait market register strong buying interest in March-07

Published April 2nd, 2007 - 06:22 GMT

<?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Kuwait market register strong buying interest in March-07



Global Investment House - Kuwait Stock Exchange Performance – March 2007  Kuwait market continued its positive momentum and witnessed strong buying interest across-the-board, as the investors were attracted by the market valuation and good corporate earnings reports. “Global” General Index reported a monthly increase of 6.27% and ended the month of Mar-07 at 315.25 points. The index reported overall YTD gain of 8.40% at the end of Mar-2007. The market capitalization reached KD45.99bn at the end of Mar-07, registering a gain of 6.26% as compared to the previous month. Kuwait Stock Exchange Price Index crossed the psychological 10,000-mark during the month and closed at 10,221.7 points, reporting a monthly gain of 4.8% in Mar-07.


According to the latest reports, Kuwait Exchange (KSE) approved listing of six new companies, which include Al-Qurain Petrochemical Industries Company, Hayal Communications, The Mechanic Net, Gulf horizons, Future Communications and the Bareeq Holding Company. The listing of new companies will not only improve the market depth of the bourse, but also provide investors with new opportunities to invest. The recent growth seen in the last two months have also encouraged companies to list themselves, as the investors’ confidence seems to be improving.


The strong investors’ interest can also be witnessed from strong growth in trading activity. Volume of shares traded on the bourse witnessed a whopping monthly increase of 129.75%, aggregating to 5.24bn shares in the month. Value of shares traded also witnessed an increase of 117.59%, amounting to KD2.80bn. Both the volume and value of shares traded during the month were the highest that were recorded in the last 15 months. Service sector accounted for 29.5% of the total value of shares traded on the exchange during the month. Three months in a row, it was Kuwait Projects Company (KIPCO) that topped the list in terms of volumes of shares traded. KIPCO’s 299.66mn shares changed hands at a value of KD239.01mn during the month. The stock price of KIPCO increased by 1.3% to end the month at KD0.770.


Food sector index hogged the limelight during the month, in terms of trading activity as well as price gainers. The sector index reported a substantial growth of 32.92% to end the month at 315.47 points. Kuwait Food Company (KFC) and United Fisheries of Kuwait (UFK), the two helped the index in registering this substantial growth. Despite of reporting a yearly decline in net profit by 37%, the stock price of KFC appreciated by 42.9% to close at KD2.000. On the other hand, the news that Kuwait Projects Company (KIPCO) sold its 40% stake in UFK to Al-Safwa Group Company for KD40.04mn helped the price of UFK to appreciate by 65% at the end of the month.


Global Banking Sector index reported a monthly increase of 8.82% and a YTD gain of 9.72% by the end of the month. Index heavy weight National Bank of Kuwait (NBK) was granted the license to operate in UAE. During the month, the bank completed the largest foreign exchange deal in the history of Kuwait, where the bank supplied US$3.35bn worth KD978.55mn for a QTel to acquire a 50% stake in Wataniya Telecom. As a result of these positive news flow, the stock price of NBK appreciated by 9.3% to end the month at KD2.120.


The two telecom companies in Kuwait were in the news during the month, as Qatar Telecom (Qtel) bought a 51% stake in Wataniya Telecom. Also, Mobile Telecommunication Company’s (MTC) US$6.11bn bid for the third mobile telecom license in Saudi Arabia, was the highest bid price among the six consortia including South Africa's MTN Group and Dubai’s Oger Telecom. According to analysts, the bid price by MTC seems to on the higher side, but MTC is quite optimistic about the growth opportunities in the Kingdom. Once MTC is awarded the license, it will compete with the two existing operators Saudi Telecom and Etihad Etisalat.


Market breadth during the month tilted in favor of the advancers, as 96 stocks reported monthly gains as compared to 61 monthly losers, whereas the prices of 24 stocks remained unchanged. It is worth noting that 42 companies reported a double digit monthly gain during the month of March. The major gainers during the month were United Fisheries of Kuwait (+65.0%), United Project Company (+45.5%), Al-Abraj Holding Company (+44.3%) and National Real Estate Company (+44.2%). The biggest losers during the month were National Cleaning Company (-17.2%), Commercial Facilities Company (-16.8%) and Gulf Franchising Company (-14.3%). Going forward, the first quarter earnings around the corner, we expect to see some select stocks being aggressively traded in the market.


Value Leaders (KD)


Mobile Telecommunications Company


Kuwait Projects Company (Holding)


Public Warehousing Company


Kuwait Real Estate Bank


National Real Estate Company



Volume Leaders


Kuwait Projects Company (Holding)


Al Safwa Group Company


The Commercial Real Estate Co


Kuwait Real Estate Bank


National Real Estate Company




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