A brokerage cut its price target for Emaar Properties shares yesterday, even before a new report showed that property prices in Dubai continue to decline.
Alembic HC Securities forecastEmaar's next three quarters would be weighed down by a Dh172 million impairment on Dubai Bank, sluggish property deliveries and a full write-down of the Islamic mortgage company Amlak Finance.
"We feel that the timing [of the impairments] may be unfavourable given the already weak earnings outlook for the year on the back of an expected slowdown in deliveries," Majed Azzam, an analyst at Alembic,told clients in a note yesterday.
The analyst cut the stock's fair value to Dh3.20, from Dh3.30, while maintaining a "neutral" rating.
Dubai Bank, which was known to have been under pressure for some time, was taken over by the Dubai Government on May 16. Emaar had a 30 per cent stake in the lender.
Amlak was suspended from trading in 2008 after the financial crisis cut its access to credit. Emaar holds a 45 per cent stake in the company.
"An impairment of Dh800m on Amlak this year now appears more probable, as it appears unlikely that the Government will intercede with a bailout that would benefit Emaar," Mr Azzam said.
Meanwhile, property prices in Dubai have failed to improvesince unrest broke out in parts of the Middle East and North Africa, contrary to speculation that investors would flock to the emirate as a safe haven, according to a Deutsche Bank report.
The report showed home values declined 1.2 per cent last month compared with the previous month and rents fell by 1 per cent, the analysts Nabil Ahmed and Athmane Benzerroug said in a note.
"Despite talks of renewed interest in real estate following regional unrest, there is no visible sign of an improvement," they said.
Dubai property prices have dropped 64 per cent from their peak in mid-2008, while rents have fallen by 55 per cent, according to Deutsche Bank.
Emaar closed 0.9 per cent higher at Dh3.12 yesterday.
halsayegh@thenational.ae
UAE v IRELAND
All matches start at 10am, and will be played in Abu Dhabi
1st ODI, Friday, January 8
2nd ODI, Sunday, January 10
3rd ODI, Tuesday, January 12
4th ODI, Thursday, January 14
UAE currency: the story behind the money in your pockets
RESULTS
6.30pm: Emirates Holidays Maiden (TB) Dh 82,500 (Dirt) 1,900m
Winner: Lady Snazz, Richard Mullen (jockey), Satish Seemar (trainer).
7.05pm: Arabian Adventures Maiden (TB) Dh 82,500 (D) 1,200m
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7.40pm: Emirates Skywards Handicap (TB) Dh 82,500 (D) 1,200m
Winner: Rich And Famous, Royston Ffrench, Salem bin Ghadayer.
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Winner: Rio Angie, Sam Hitchcock, Doug Watson.
8.50pm: Emirates Sky Cargo (TB) Dh 92,500 (D) 1,400m
Winner: Kinver Edge, Richard Mullen, Satish Seemar.
9.15pm: Emirates.com (TB) Dh 95,000 (D) 2,000m
Winner: Firnas, Xavier Ziani, Salem bin Ghadayer.
Ukraine
Capital: Kiev
Population: 44.13 million
Armed conflict in Donbass
Russia-backed fighters control territory
Company Profile
Company name: NutriCal
Started: 2019
Founder: Soniya Ashar
Based: Dubai
Industry: Food Technology
Initial investment: Self-funded undisclosed amount
Future plan: Looking to raise fresh capital and expand in Saudi Arabia
Total Clients: Over 50
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Director: Nick Bruno and Troy Quane
Stars: Will Smith, Tom Holland, Karen Gillan and Roshida Jones
Rating: 4 out of 5 stars
The specs
Engine: 1.5-litre turbo
Power: 181hp
Torque: 230Nm
Transmission: 6-speed automatic
Starting price: Dh79,000
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Starring: Nicole Kidman, Liev Schreiber, Jack Reynor
Creator: Jenna Lamia
Rating: 3/5
Greatest of All Time
Starring: Vijay, Sneha, Prashanth, Prabhu Deva, Mohan
Founders: Abdulmajeed Alsukhan, Turki Bin Zarah and Abdulmohsen Albabtain.
Based: Riyadh
Offices: UAE, Vietnam and Germany
Founded: September, 2020
Number of employees: 70
Sector: FinTech, online payment solutions
Funding to date: $116m in two funding rounds
Investors: Checkout.com, Impact46, Vision Ventures, Wealth Well, Seedra, Khwarizmi, Hala Ventures, Nama Ventures and family offices
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