Companies across the Gulf are rushing to cash in on Qatar's 2022 World Cup good fortune, pushing stocks across the region to new highs.
Mohamed Alabbar, the chairman of Emaar Properties, the UAE's largest publicly traded company, said he would actively pursue contracts in Qatar. "If there is any opportunity, you will see me in Qatar," he said on Al Arabiya television.
The announcement was the first of a stream from the regional property sector voicing ambitions to benefit from Qatar's victory last week.
Arabtec's senior management held a meeting yesterday afternoon to discuss investment plans in Qatar. "We certainly will be targeting stadiums and all the rest of the infrastructure. We have a big interest and we have the resources and the experience," said Thomas Barry, the construction company's chief executive.
A recent meeting in Doha was set up to discuss potential contracts that include stadiums, hotels, retail and residential housing, Mr Barry said. Arabtec has partnered the German company Max Bogl to build two stadiums in Dubai Sports City.
In June, Arabtec signed a deal to build the Qatar World Trade Centre in Doha, a 50-storey tower with an auditorium and exhibition space.
In Egypt, shares of Orascom Construction Industries made their biggest increase in mid-day trading since May, to 268 Egyptian pounds, on speculation it may win contracts in Qatar in the lead-up to the World Cup.The country's biggest publicly traded builder was vakued at 55.5 billion Egyptian pounds (Dh35.22bn). The shares closed 3.2 per cent up at 266.75 pounds and the Egypt Exchange closed 1.09 per cent higher at 6,762.37 points.
Qatar, the first Arab nation to host the world football event, has promised to spend as much as US$50bn (Dh183.64bn) on infrastructure upgrades and $4bn to build nine stadiums and renovate three others.
Qatar's stocks yesterday rode the wave from the winning World Cup bidand in the first day of trading since the selection was announced, the country's bourse gained 3.6 per cent. It rose as much as 7.8 per cent in mid-day trading.
The UAE markets were closed for National Day and Islamic New Year celebrations but trading is likely to be brisk when they reopen today as investors target local companies poised to benefit from the surge in infrastructure spending.
"I think the benefits will be reflected selectively on construction companies," said Fadi al Said, a senior fund manager at ING.
Digvijay Tanwar, a senior financial analyst at Global Investment House in Kuwait, pointed to Drake & Scull as a potential beneficiary of the football event.
Earlier this year, a Drake & Scull acquisition led to the formation of Drake & Scull International Qatar, a mechanical, electrical and plumbing company based in the country. The acquisition also provides greater access to a government-investment fuelled construction market in Qatar.
Mr al Said said increased attention on the region should also help the UAE's reclassification as an emerging market on the MSCI Index. The country is still considered a frontier market, making it more volatile and less attractive to foreign and long-term institutional investors.
If UAE companies do obtain contracts, they will be looking to avoid the negative headlines that Emaar-MGF, the company responsible for much of the construction for the Commonwealth Games, suffered.
The company, a joint venture between Dubai's Emaar Properties and India's MGF Development, was blamed by the Indian government for missed deadlines and alleged construction defects.
Emaar-MGF denies the claims and has said it would fight a judgment that the Delhi Development Authority is seeking to collect compensation.
The rest of the markets in the region closed higher yesterday, with the exception of Saudi Arabia's Tadawul, which fell 0.4 per cent to 6,396.36 points. Bahrain rose 0.2 per cent to 1.422.18 points; Kuwait gained 0.7 per cent to 6,865.40 points; Oman rose 0.5 per cent to 6,697.49 points; Lebanon ticked 0.4 per cent higher to 1,442.18 points; and Jordan moved 0.05 per cent higher to 2,360.24 points.
* with reporting from Kevin Brass