Mubasher 20160517 Foreign Fund Flows April 2016

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Foreign Fund Flows (FFF) April 2016 Trading Review

Equities | MENA

Tuesday, 17 May 2016

Month Abu Dhabi Dubai Egypt Kuwait Oman Qatar Saudi Arabia Total

May-15 130.0 140.5 (24.0) 24.1 4.0 562.4 (31.9) 805.0

Jun-15 61.9 170.5 54.2 85.8 (24.6) 6.0 (250.2) 103.6

Jul-15 154.4 100.7 35.0 31.4 3.2 (73.3) (66.7) 184.6

Aug-15 91.7 (45.2) (31.1) (40.2) (28.3) 113.1 (136.0) (76.0)

Sep-15 79.3 36.3 12.9 (9.7) (9.5) 62.4 540.1 711.8

Oct-15 54.1 46.6 20.4 (29.3) (47.5) 51.4 (286.6) (190.8)

Nov-15 256.4 (90.0) (76.9) (59.2) (41.0) (17.5) (114.7) (142.8)

Dec-15 146.1 (54.4) (68.4) (13.3) 84.5 (192.3) (234.6) (332.4)

Jan-16 53.8 (99.4) (69.5) (67.3) (33.5) (46.8) (61.3) (324.0)

Feb-16 150.8 116.4 (26.8) 19.4 (33.4) 20.1 (117.3) 129.2

Mar-16 289.1 147.6 104.8 7.0 (27.8) 251.5 (85.3) 686.8

Apr-16 214.4 176.3 72.6 11.1 (11.9) 146.1 80.0 688.6

Trailing 12M 1,682.1 645.8 3.1 (40.4) (165.8) 883.0 (764.6) 2,243.4

All figures in USDmn

Note: Foreigners include non-GCC Arabs in Saudi Arabia and Qatar. Sources: Countries’ stock exchange

websites, Bloomberg, MubasherTrade Research

Net trading by foreigners in key MENA markets (Egypt and GCC, ex-Bahrain) • In April 2016, foreigners were net buyers for the third consecutive month with net inflows of USD688.6mn versus net inflows of USD686.8mn a month earlier. Foreigners were: o Net sellers in Oman: total outflows of USD12mn. o Net buyers in Abu Dhabi, Dubai, Egypt, Kuwait, Qatar and Saudi Arabia: total inflows of

USD701mn. o In the trailing 12-month period, foreigners were net buyers across all MENA markets (ex.

Kuwait, Oman and Saudi Arabia).

• IMF cut its 2016 growth forecasts for Egypt from 4.3% to 3.3%, Oman from 2.8% to 1.8%, Qatar from 4.9% to 3.4% and UAE from 2.6% to 2.4%, citing weak oil environment in the GCC region which pushed some governments to tap the debt markets for the first time in long years. The IMF decreased Egypt’s growth forecasts due to the decline in tourism revenues to USD500mn in Q1 2016, the lowest level since the January revolution. On another note, key GCC countries are planning to lower the facilities granted to expatriates. The Kuwaiti government intends to increase the price of power and water for foreigners. The Omani government proposed a 3% monthly fee on non-Omani workers while the Saudi government limited all jobs related to hiring workers in the private sector to Saudi nationals. On 17 April, the Doha meeting failed to reach an agreement to freeze oil production at January levels as Saudi Arabia demanded Iran to join the deal. In Saudi Arabia, Deputy Crown Prince Mohammed bin Salman announced his "Saudi Vision 2030", setting goals for the next 15 years in a package of economic and social policies designed to free the kingdom from dependence on oil exports. Furthermore, he announced that the state-controlled Public Investment Fund will be restructured as a hub for Saudi investment abroad, partly by raising money through IPO of less than 5% stake in the kingdom oil giant Aramco.

Ahmed Abd Elnaby Strategist

Mubasher International [email protected]

IMF lowers 2016 forecasts for key MENA countries; foreigners are net buyers in April across all markets except for Oman

Ayman Elshahed Analyst

Mubasher International [email protected]

-1,500

-1,000

-500

0

500

1,000

1,500

-1,500

-1,000

-500

0

500

1,000

1,500

Abu Dhabi Dubai Egypt Kuwait Oman Qatar Saudi Arabia Total

USDmn

Index Level % Change ADT (USDmn) % Change

Market Mar-16 Apr-16 MoM Mar-16 Apr-16 MoM

Saudi Arabia 6,223.1 6,805.8 9.4% 1,521 1,568 3%

Oman 5,467.4 5,942.7 8.7% 11 16 56%

UAE (DFM) 3,355.5 3,491.9 4.1% 232 193 -17%

UAE (ADX) 4,390.4 4,543.5 3.5% 85 66 -22%

Egypt 7,525.0 7,773.2 3.3% 93 83 -11%

Kuwait 5,228.8 5,391.8 3.1% 47 46 -3%

Qatar 10,376.2 10,186.2 -1.8% 113 100 -12%

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Foreign Fund Flows (FFF) | April 2016 Trading Review


EGYPT Monthly Breakdown 3 Historical Trend 4 KUWAIT Monthly Breakdown 6 Historical Trend 7 OMAN Monthly Breakdown 9 Historical Trend 10 QATAR Monthly Breakdown 12 Historical Trend 13 Top Stocks Inflows/Outflows 15

SAUDI ARABIA Monthly Breakdown 16 Historical Trend 17 UAE (ABU DHABI) Monthly Breakdown 19 Historical Trend 20 Top Stocks Inflows/Outflows 22 UAE (DUBAI) Monthly Breakdown 23 Historical Trend 24 Top Stocks Inflows/Outflows 26

Table of Contents







Breakdown by Nationality Nationality (%)

Breakdown by Investor Type

Investor Type (%)

Egypt | Monthly Breakdown | April 2016

Foreigners were net buyers in April with the same contribution to total trading from a month earlier.

Institutions were net buyers with slightly lower contribution to total trading.

1,333191

244

-1,425-172

-172

-92

19

73

-120

-80

-40

0

40

80

120

160

-2,000

-1,500

-1,000

-500

0

500

1,000

1,500

Nationals Arabs Foreigners

Buy Sell Net (RHS)USDm

681

1,087

-652

-1,116

28

-28

-40

-30

-20

-10

0

10

20

30

40

-1,000

-500

0

500

1,000

Institutions Individuals

Buy Sell Net (RHS)USDmn

Nationals78%

Arabs10%

Foreigners12%

Institutions38%

Individuals62%







Total Turnover Average Daily Turnover

By Nationality By Investor Type

Egypt | Historical Trend

Trading turnover and ADT decreased by 27% and 11% MoM, respectively.

Institutions contribution to total trading decreased MoM.

-40%

-20%

0%

20%

40%

60%

80%

100%

120%

140%

-

500

1,000

1,500

2,000

2,500

3,000

Total Turnover Chg MoM (RHS)

USDmn

-40%

-20%

0%

20%

40%

60%

80%

100%

120%

0

10

20

30

40

50

60

70

80

90

100

ADT Chg MoM (RHS)

USDmn

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Foreigners Arabs Nationals

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Individuals Institutions







Net Trading by Nationality Net Trading by Investor Type

Foreigners’ Cumulative Net Trading

Egypt | Historical Trend (Cont.’d)

(150.0)

(100.0)

(50.0)

-

50.0

100.0

150.0

Egyptians Arabs ForeignersUSDmn

(200.0)

(150.0)

(100.0)

(50.0)

-

50.0

100.0

150.0

200.0

Institutions IndividualsUSDmn

(24.0)

54.2 35.0

(31.1)

12.9 20.4

(76.9) (68.4) (69.5)

(26.8)

104.8

72.6

(200)

(150)

(100)

(50)

-

50

100

150

May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16

Cumulative net trading for last 12 months Foreigners

USDmn









Investor Type (%)

Kuwait | Monthly Breakdown | April 2016

Foreigners are net buyers for the third consecutive month with a lower contribution to total trading.

Contribution by individuals and client accounts increased to 51% and 16%, respectively, on account of lower contribution by funds and corporate investors.

799 3681

-822 -25 -70

-23

11 11

Nationals GCC Foreigners

-40

-30

-20

-10

0

10

20

30

40

-1,000

-800

-600

-400

-200

0

200

400

600

800

1,000Buy Sell Net (RHS)USDmn

225

105

136

450

-205 -59

-163 -489

21

46

-27-39

-120

-80

-40

0

40

80

120

-500

-300

-100

100

300

500

Company Funds ClientsAccounts

Individuals


Nationals89%

GCC3%Foreigners

8%

Company24%

Funds9%

Clients Accounts

16%

Individuals51%









Kuwait | Historical Trend

Trading turnover and ADT decreased by 16% and 3% MoM, respectively.

Foreigners contribution to total trading decreased.

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

-

200

400

600

800

1,000

1,200

1,400


USDmn

-30%

-20%

-10%

0%

10%

20%

30%

40%

0

10

20

30

40

50

60

ADT Chg MoM (RHS)

USDmn

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Individuals Company/Establishment

Investment Funds Clients Accounts









24.1

85.8

31.4

(40.2)

(9.7)(29.3)

(59.2)

(13.3)

(67.3)

19.4 7.0 11.1

(100)

(50)

-

50

100

150

200


Cumulative net trading for last 12 months ForeignersUSDmn

(100)

(80)

(60)

(40)

(20)

-

20

40

60

80

100

120

Company/Establishment

Investment Funds Individuals Clients Accounts

USDmn

(100)

(80)

(60)

(40)

(20)

-

20

40

60

80

100

Kuwaitis GCC ForeignersUSDmn

Kuwait | Historical Trend (Cont.’d)









Investor Type (%)

282 216

18

-279-12 -6 -30

29

0

-12

Nationals GCC Arabs Foreigners

-60

-40

-20

0

20

40

60

-300

-200

-100

0

100

200

300


Oman | Monthly Breakdown | April 2016

Foreigners are still net sellers with lower contribution to total trading.

Trading by institutions showed lower contribution vs. 68% in March 2016.

192135

-173 -155

20

-20

-25

-20

-15

-10

-5

0

5

10

15

20

25

-200

0

200

400



Nationals86%

GCC5%

Arabs1%

Foreigners7%

Institutions56%

Individuals44%









Oman | Historical Trend

Total turnover and ADT increased by 40% and 56%, respectively, compared to March 2016.

Foreigners’ contribution to trading volumes fell by almost a half.

-100%

-50%

0%

50%

100%

150%

200%

-

100

200

300

400

500

600

700


USDmn

-100%

-50%

0%

50%

100%

150%

200%

250%

0

5

10

15

20

25

30

ADT Chg MoM (RHS)

USDmn

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Nationals GCC Arabs Foreigners

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Institutions Individual









Oman | Historical Trend (Cont.’d)

(60.0)

(40.0)

(20.0)

-

20.0

40.0

60.0

80.0

100.0

Omanis Aarbs GCC ForeignersUSDmn

(80.0)

(60.0)

(40.0)

(20.0)

-

20.0

40.0

60.0

80.0

Institutions IndividualUSDmn

4.0

(24.6)

3.2

(28.3)(9.5)

(47.5) (41.0)

84.5

(33.5) (33.4) (27.8)(11.9)

(200)

(150)

(100)

(50)

-

50

100


Cumulative net trading for last 12 months ForeignersUSDmn









Investor Type (%)

Qatar | Monthly Breakdown | April 2016

Foreigners are still net buyers with a contribution of 28% of total trading, lower from March’s 31%.

Institutions are net buyers, contributing by 32% to total trading compared to 38% in March.

1,240 115635

-1,388

-113

-489

-148

2

146


-200

-160

-120

-80

-40

0

40

80

120

160

200

-1,600

-1,200

-800

-400

0

400

800

1,200


6601,330

-618-1,372

42

-42-50

-40

-30

-20

-10

0

10

20

30

40

50

-2,000

-1,500

-1,000

-500

0

500

1,000

1,500



Nationals66%

GCC6%

Foreigners28%

Institutions32%

Individuals68%









Qatar | Historical Trend

Both total turnover and ADT decreased by 20% and 12% MoM, respectively.

Trading contribution by nationals slightly increased in April 2016, on account of lower contribution by foreigners and GCC.

-60%

-40%

-20%

0%

20%

40%

60%

80%

100%

120%

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000


USDmn

-60%

-40%

-20%

0%

20%

40%

60%

80%

100%

0

20

40

60

80

100

120

140

160

180

200

ADT Chg MoM (RHS)

USDmn

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Nationals Foreigners GCC

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%










Qatar | Historical Trend (Cont.’d)

(600.0)

(400.0)

(200.0)

-

200.0

400.0

600.0

800.0

Qatari Foreigners GCCUSDmn

(150.0)

(100.0)

(50.0)

-

50.0

100.0

150.0

Institutions IndividualsUSDmn

562.4

6.0

(73.3)

113.1 62.4 51.4

(17.5)

(192.3)

(46.8)

20.1

251.5

146.1

(400)

(200)

-

200

400

600

800

1,000



USDmn







Qatar | Top Stocks Inflows/Outflows | April 2016

Inflows | Top 5 Stocks (USDmn)

Outflows | Top 5 Stocks (USDmn)






* Trading on the stock took place in the last two trading days of April









Investor Type (%)

Saudi Arabia | Monthly Breakdown | April 2016

Foreigners turned to be net buyers with higher contribution to total trading. The nationals dominate the trading volume with almost the same contribution to total trading compared to March 2016.

Institutions are still net buyers with the same contribution to total trading compared to March 2016. The individuals still dominate the trading volume.

29,848

517

997

-29,968 -477 -917

-120

40

80


-200

-150

-100

-50

0

50

100

150

200

-40,000

-30,000

-20,000

-10,000

0

10,000

20,000

30,000


4,4851,004

25,873

-2,020-923

-28,419

2,465

81

-2,546

-3,000

-2,000

-1,000

0

1,000

2,000

3,000

-40,000

-30,000

-20,000

-10,000

0

10,000

20,000

30,000

Institutions Foreigners(SWAP)

Individuals


Nationals95%

GCC2%

Foreigners3%

Institutions10%

Foreigners (SWAP)

3%

Individuals87%









Saudi Arabia | Historical Trend

Total turnover decreased by 10% MoM while ADT increased by 3% MoM.

National individuals still dominate the total trading with almost the same volumes.

-80%

-60%

-40%

-20%

0%

20%

40%

60%

80%

100%

120%

-

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000


USDmn

-40%

-30%

-20%

-10%

0%

10%

20%

0

500

1,000

1,500

2,000

2,500

ADT Chg MoM (RHS)

USDmn

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Institutions Individuals Foreigners (SWAP)









Saudi Arabia | Historical Trend (Cont.’d)

(0.4)

(0.3)

(0.2)

(0.1)

-

0.1

0.2

0.3

0.4

0.5

0.6

Nationals GCC ForeignersUSDbn

(3.0)

(2.0)

(1.0)

-

1.0

2.0

3.0

Institutions Foreigners (SWAP) IndividualsUSDbn

(0.032)

(0.250)

(0.067)(0.136)

0.540

(0.287)

(0.115)(0.235)

(0.061)(0.117) (0.085)

0.080

-1.0

-0.8

-0.6

-0.4

-0.2

0.0

0.2

0.4

0.6

0.8



USDbn









Investor Type (%)

UAE (Abu Dhabi) | Monthly Breakdown | April 2016

Foreigners are still net buyers but with lower contribution to total trading.

Individuals are still net sellers with higher contribution to total trading volume.

680127

61

458

-868-144 -70

-244

-188

-17 -9

214

Nationals Arabs GCC Foreigners

-400

-200

0

200

400

-1,500

-1,000

-500

0

500

1,000


701 625

-474-852

227

-227-250

-200

-150

-100

-50

0

50

100

150

200

250

-1,200

-800

-400

0

400

800

Company Individuals


Nationals58%

Arabs10% GCC

5%

Foreigners27%

Company44%

Individuals56%









0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Company Individuals

UAE (Abu Dhabi) | Historical Trend

Total turnover and ADT decreased by 29% and 22% MoM respectively.

Contribution by nationals and individuals decreased in April compared with March.

-40%

-20%

0%

20%

40%

60%

80%

-

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000


USDmn

-60%

-40%

-20%

0%

20%

40%

60%

80%

0

10

20

30

40

50

60

70

80

90

ADT Chg MoM (RHS)

USDmn

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Arabs GCC Foreigners Nationals









UAE (Abu Dhabi) | Historical Trend (Cont.’d)

(300)

(200)

(100)

-

100

200

300

400

UAE Arab GCC ForeignersUSDmn

(800)

(600)

(400)

(200)

-

200

400

600

800

Company IndividualUSDmn

130.0 61.9

154.4 91.7 79.3 54.1

256.4 146.1

53.8 150.8

289.1 214.4

-

200

400

600

800

1,000

1,200

1,400

1,600

1,800



USDmn







-5.1

-33.4

-46.5

-49.0

-92.8

National Bank of Abu Dhabi

First Gulf Bank

Abu Dhabi Commercial Bank

Aldar Properties

EmiratesTelecommunications

92.5

67.5

45.1

36.6

3.8

EmiratesTelecommunications

Aldar Properties

Abu Dhabi CommercialBank

First Gulf Bank

National Bank of AbuDhabi

UAE (Abu Dhabi) | Top Stocks Inflows/Outflows | April 2016









Arab GCC Foreigners Nationals

21.0

3.5

3.1

2.4

1.1

Invest bank

National Bank of RasAl-Khaima

Eshraq Properties

Dana Gas

Ras Al KhaimahCeramics

-0.5

-1.0

-3.0

-3.2

-19.7

Ras Al Khaimah Cement

Ras Al Khaimah Ceramics

Dana Gas

Eshraq Properties

Invest bank

2.8

1.3

0.5

0.2

0.0

First Gulf Bank

National Bank of AbuDhabi

Agthia Group

Methaq TakafulInsurance

Bank of Sharjah

-0.3

-1.8

-1.8

-3.7

-7.7

Ras Al Khaimah Ceramics

Invest bank

RAK Properties

National Bank of Ras Al-Khaima

Aldar Properties

2.2

0.9

0.7

0.4

0.3

RAK Properties

Bank of Sharjah

Methaq Takaful Insurance

Invest bank

National Bank of Ras Al-Khaima

-1.05

-2.99

-3.3

-6.0

-6.6

Abu Dhabi Commercial Bank

Aldar Properties

Dana Gas

First Gulf Bank

Eshraq Properties









Investor Type (%)

UAE (Dubai) | Monthly Breakdown | April 2016

Foreigners are net buyers with higher contribution to total trading, up from 14% in March 2016.

Individuals are still net sellers with lower contribution to total trading, down from 80% in March 2016.

2,092

779

279709

-2,191

-794-340

-532

-100

-15

-62

176

Nationals Arabs GCC Foreigners

-200

-150

-100

-50

0

50

100

150

200

-2,500

-2,000

-1,500

-1,000

-500

0

500

1,000

1,500

2,000


9142,944

-774-3,084

140

-140

-200

-150

-100

-50

0

50

100

150

200

-4,000

-3,000

-2,000

-1,000

0

1,000

2,000

3,000

4,000


Buy Sell Net (RHS) USDmn

Nationals56%

Arabs20%

GCC8%

Foreigners16%

Institutions22%

Individuals78%









UAE (Dubai) | Historical Trend

Total turnover and ADT decreased by 29% and 17% MoM, respectively.

Foreigners contribution increased compared to March 2016.

-100%

-50%

0%

50%

100%

150%

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000


USDmn

-80%

-60%

-40%

-20%

0%

20%

40%

60%

80%

100%

0

50

100

150

200

250

300

350

ADT Chg MoM (RHS)

USDmn

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Arabs GCC Foreigners Nationals

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%










UAE (Dubai) | Historical Trend (Cont.’d)

(150.0)

(100.0)

(50.0)

-

50.0

100.0

150.0

200.0

UAE Arab GCC ForeignersUSDmn

(250.0)

(200.0)

(150.0)

(100.0)

(50.0)

-

50.0

100.0

150.0

200.0

250.0

Institutions IndividualUSDmn

140.5 170.5

100.7

(45.2)

36.3 46.6

(90.0)(54.4)

(99.4)

116.4 147.6

176.3

(200)

(100)

-

100

200

300

400

500

600

700



USDmn







120.2

7.8

6.6

3.4

2.79

Agility PublicWarehousing

Gulf Navigation Holding

Arabtec Holding

Al-Madina for Finance &Investment

Amlak Finance

7.5

4.2

3.4

2.1

1.4

Gulf Finance House

Amanat Holdings

Air Arabia

Emaar Malls Group

Aramex

112.8

28.2

17.4

8.7

5.9

Emaar Properties

Dubai Islamic Bank

Dubai Parks & Resorts


Agility Public Warehousing

UAE (Dubai) | Top Stocks Inflows/Outflows | April 2016









Arab GCC Foreigners Nationals

10.1

7.9

4.1

3.5

3.11

Dubai Investments

National CentralCooling

Mashreqbank

Union Properties

Amlak Finance

-6.69

-8.33

-10.53

-22.70

-83.63

Al-Madina for Finance &Investment


Arabtec Holding

Dubai Islamic Bank

Emaar Properties

-1.8

-3.7

-4.0

-4.3

-4.4

Amlak Finance

Mashreqbank

Amanat Holdings

Air Arabia

National Central Cooling

-5.9

-8.0

-9.2

-13.6

-19.3

Agility Public Warehousing

Dubai Islamic Bank

Dubai Investments

Dubai Parks & Resorts

Emaar Properties

-2.9

-2.9

-3.9

-4.3

-14.5

Gulf General Investment

National Central Cooling

Gulf Finance House

Dubai Financial Market

Emaar Properties



Important Disclosures METHODOLOGY: We strive to search for the best businesses that trade at the lowest valuation levels as measured by an issuer’s intrinsic value on a per-share basis. In doing so, we follow both top-down and bottom-up approaches. Under the top-down approach, we attempt to study the most important quantitative and qualitative factors that we believe can affect a security's value, including macroeconomic, sector-specific, and company-specific factors. Under the bottom-up approach, we focus on the analysis of individual stocks by running our proprietary scoring model, including valuation, financial performance, sentiment, trading, risk, and value creation.

COUNTRY MACRO RATINGS: We analyze the four main sectors of a country’s macroeconomics, then we assign , , and star for low risk, moderate risk, and high risk, respectively. We use different weights for each economic sector: (a) Real Sector (30% weight), (b) Monetary Sector (10% weight), (c) Fiscal Sector (25% weight), (d) External Sector (15% weight), and (e) Credit Rating and Outlook (20%).

STOCK MARKET RATINGS: We compare our year-end price targets for the subject market index on a total-return basis versus our calculated required rate of return (RRR). Taking into account our Country Macro Rating, we set the “Neutral” borderline (below which is “Underweight”) as 20% of RRR for Country Macro Rating, 40% of RRR for Country Macro Rating, and 60% of RRR for Country Macro Rating. That said, our index price targets are based on the average of two models. Model (1): Estimated index levels based on consensus price targets of all index constituents. Stocks with no price targets are valued at market price. Model (2): Estimated index levels based on our expected re-pricing (whether re-rating, de-rating, or unchanged rating) of the forward price-earnings ratio (PER) of each index in addition to consensus earnings growth for the forward year.

SECTOR RATINGS: On the sectors level, we focus on six major sectors, namely (1) Consumer and Health Care, (2) Financials, (3) Industrials, Energy, & Utilities, (4) Materials, (5) Real Estate, and (6) Telecom Services & IT. To assess each sector, we use the SWOT analysis to list the strengths, weaknesses, opportunities, and threats in each country. We then translate our qualitative SWOT analysis into a quantitative model to evaluate all six sectors across countries. Each of the measures we used, although mostly subjective, is assigned a score as either +1 (high impact), 0 (medium impact), or -1 (low impact). At a later stage, when assigning the final rating – Overweight, Neutral, or Underweight – for each sector in each country, we realize that sometimes it is unfair to assign equal weights for the sub-sectors in each major sector assessed. Hence, some of the sub-sectors are given different weights for their significant profile in each country. Additionally, the final rating for each sector in each specific country is assigned based on a relative calculation comparing this sector to all other sectors in this country.

Low

(1)

Moderate

(2)

High

(3)

Buy

(B)Higher than RRR Higher than RRR Higher than RRR

Hold

(H)

Between RRR

and 20% of RRR

Between RRR

and 40% of RRR

Between RRR

and 60% of RRR

Sell

(S)

Lower than 20%

of RRR

Lower than 40%

of RRR

Lower than 60%

of RRR

Not Rated

(NR)

Not Covered

(NC)

We do not currently cover this stock or we are

restricted from coverage for regulatory reasons.

Inv

es

tme

nt

Ra

tin

g

Risk Rating

We have decided not to publish a rating on the

stock due to certain circumstances related to the

company (i.e. special situations).

If

Total Return

is …

Disclosure Appendix

SECURITY INVESTMENT RATINGS: We combine intrinsic value, relative valuation, and market sentiment into a single rating. Our three-pronged methodology involves (1) discounted cash flows “DCF” valuation model(s), (2) relative valuation metrics, and (3) overall sentiment. Whenever possible we attempt to apply all three aspects on the issuers or securities under review. In certain cases where we do not have our own financial and valuation models, we attempt to scan the market for other analysts’ value estimates and ratings (i.e. consensus view) on average. We compliment this with relative valuation and sentiment drivers, such as positive/neutral/negative news flows. For all issuers/securities covered, we have three investment ratings (Buy, Hold, or Sell), comparing the security’s expected total return (including both price performance and expected cash dividend) over a 12-month period versus its Required Rate of Return “RRR” as calculated using the Capital Asset Pricing Model “CAPM” and adjusted for the Risk Rating we attach to each security. Our price targets are subjective and are estimates of the analysts where the securities covered will trade within the next 12 months. Price targets can be derived from earnings-based valuation models (e.g. Discounted Cash Flow “DCF”), asset-based valuation models (e.g. Net Asset Value “NAV”), relative valuation multiples (e.g. PER, PBV, EV/EBITDA, etc.), or a combination of them. In case we do not have our own valuation model, we use a weighted average of market consensus price targets and ratings. We review the investment ratings periodically or as the situation necessitates.

SECURITY RISK RATINGS: We assess the risk profile of each issuer/security covered and assign one of three risk ratings (High, Moderate, or Low). The risk rating is weighted to reflect different aspects specific to (1) the sector, (2) the issuer, (3) the security under review, and (4) volatility versus the market (as measure by beta) and versus the security’s average annualized standard deviation. We review the risk ratings at least annually or as the situation necessitates.

Other Disclosures MFS does not have any proprietary holding in any securities. Only as a nominee, MFS holds shares on behalf of its clients through Omnibus accounts. MFS is not currently a market maker for any listed securities.

Analyst Certification I (we), Ahmed Abd Elnaby, Strategist, and Ayman Elshahed, Analyst, employed with Mubasher International, a company under the National Technology Group of Saudi Arabia being a shareholder of Mubasher Financial Services BSC (c) and author(s) to this report, hereby certify that all the views expressed in this research report accurately reflect my (our) views about the subject issuer(s) or security(ies). I (we) also certify that no part of my (our) compensation was, is or will be directly or indirectly related to the specific recommendation(s) or view(s) expressed in this report.

Head of Research Certification I, Amr Hussein Elalfy, Global Head of Research of Mubasher Financial Services BSC (c) confirm that I have vetted the information, and all the views expressed by the Analyst in this research report about the subject issuer(s) or security(ies). I also certify that the author of this report, has not received any compensation directly related to the contents of the Report.

Disclaimer This document is not and should not be construed as an offer to sell or the solicitation of an offer to purchase or subscribe for any investment. Mubasher Financial Services BSC (c) (‘MFS’) has based this document on information obtained from sources it believes to be reliable but which it has not independently verified; MFS makes no guarantee, representation or warranty and accepts no responsibility or liability as to its accuracy or completeness. The opinions contained within the document are based upon publicly available information at the time of publication and are subject to change without notice. This document is not intended for all recipients and may not be suitable for all investors. Securities described in this document are not available for sale in all jurisdictions or to certain category of investors. The document is not substitution for independent judgment by any recipient who should evaluate investment risks. Additionally, investors must regard this document as providing stand-alone analysis and should not expect continuing analysis or additional documents relating to the issuers and/or securities mentioned herein. Past performance is not necessarily a guide to future performance. Forward-looking statements are not predictions and may be subject to change without notice. The value of any investment or income may go down as well as up and you may not get back the full amount invested. Where an investment is denominated in a currency other than the local currency of the recipient of the research report, changes in the exchange rates may have an adverse effect on the value, price or income of that investment. In case of investments for which there is no recognized market, it may be difficult for investors to sell their investments or to obtain reliable information about its value or the extent of the risk to which it is exposed. References to ratings/recommendations are for informational purposes only and do not imply that MFS adopts, supports or confirms in any way the ratings/recommendations, opinions or conclusions of the analysts. This document is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country, or other jurisdiction where such distribution, publication, availability or use would be contrary to law, regulation or which would subject MFS or its affiliates to any registration or licensing requirements within such jurisdiction. MFS accepts no liability for any direct, indirect, or consequential damages or losses incurred by third parties including its clients from any use of this document or its contents.

Copyright © Copyright 2016, Mubasher Financial Services BSC (MFS), ALL RIGHTS RESERVED. No part or excerpt of this document may be redistributed, reproduced, stored in a retrieval system, or transmitted, on any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of MFS. MubasherTrade is a trademark of Mubasher Financial Services BSC. Mubasher Financial Services BSC (c) is an Investment Business Firm Category 1, licensed and regulated by the Central Bank of Bahrain.

Issuer of Report Mubasher Financial Services BSC (c) is an Investment Business Firm Category 1, licensed and regulated by the Central Bank of Bahrain. Website: www.MubasherTrade.com E-mail: [email protected]









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Mubasher 20160517 Foreign Fund Flows April 2016