Shares in UAE's top bank may rise after Q4

Shares in NBAD may open higher after the lender's fourth-quarter profit topped forecasts
By Reuters
Wed 30 Jan 2013 10:33 AM

Shares in National Bank of Abu Dhabi (NBAD) may open higher after the lender's fourth-quarter profit topped forecasts.

The UAE's largest lender by market value posted a 55-percent rise in quarterly profit, helped by higher investment income and lower impairment charges.

Shares in NBAD closed at AED11.1 on Monday to be up 7.8 percent in January, on top of a 13.2 percent rise in the fourth quarter as investors bought on expectations of strong earnings growth and dividends.

NBAD has proposed a cash dividend of 35 percent and stock dividend of 10 percent - 1 bonus shares for every 10 shares held.

The bank will also discuss issuing a new convertible bond worth up to US$500m at an extraordinary general meeting set for March 12.

"The results are ahead of expectations, the dividend is ticking higher as well but the stock is close to a major resistance of AED11.50," says Anastasios Dalgiannakis, institutional trading manager at Mubasher.

"It's less risky to look at the convertible bond right than the equity."

NASDAQ Dubai-listed DP World is up 11.6 percent this year and on Tuesday the port operator said it expects 2012 profit to be in line with analysts' forecasts despite a 1.4 percent drop in consolidated container volumes for the year.

"We expect that 2013 will benefit from new capacity in key ports, but we continue to view macroeconomic challenges as the major risk for the company," Samir Murad, vice-president of research at NBK Capital says in a note.

"Since the stock currently trades at a 3 percent premium to our fair value, we are lowering our recommendation from Accumulate to Hold."

Elsewhere, Saudi Arabian Mining Company (Maaden) said it aims to complete the financing for a US$7bn phosphate project by the end of the year.

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