Three cement firms weather local storm



DUBAI // With projects worth close to US$500 billion (Dh1.83 trillion) on hold in the country, it would be natural to assume that shares of cement firms here will continue to crumble. But three Abu Dhabi-listed makers are weathering the storm well, according to a Kuwait-based investment bank that placed buy ratings on the stocks this week.

Global Investment House believes shares of RAK Cement have upside potential of close to 50 per cent, while both Gulf Cement and Fujairah Cement Industries could jump as much as 30 per cent. This is despite cement prices dropping 11.4 per cent last year. The investment bank said in a report that it expected a 19 per cent capacity increase by 2011. RAK Cement benefits from being 20 per cent owned by Abu Dhabi's Hydra Properties, which has many continuing projects that should help keep demand constant.

Gulf Cement and Fujairah Cement feature effective internal cost controls and little exposure to poorly performing outside investments, the bank noted. The recommended price target for RAK Cement is Dh1.55, while Gulf Cement and Fujairah Cement are priced at Dh2.19 and Dh2.86 respectively. The bank is less bullish on Arkan Building Materials in Abu Dhabi, as it is expected to post a 24.1 per cent drop in its gross margins for last year. Global Investment House predicts the stock could drop as much as 33 per cent.

"Arkan ventured into the steel segment in the last two years and received a severe burn because of depreciation in commodity prices," said Hettish Karmani, a senior financial analyst at Global Investment House. "It also wrote down inventories worth Dh430m." The new price target for Arkan is Dh1.68, down from its January 11 close of Dh2.53. The entire sector is under intense pressure as demand for cement has abruptly reversed.

In the boom years of rapid expansion in the region there was typically a demand-supply gap of between 3 million and 5 million tonnes a year. Last year there was a surplus of more than 3 million tonnes, Mr Karmani said. Economic uncertainty and lack of project financing in the country has forced developers to either cancel or put on hold 49 per cent of the $924bn worth of developments in the country, Global Investment House's report said.

In order to diversify and boost profits, most cement makers invested heavily in property and equity markets in the boom years. The value of these investments has declined dramatically, increasing pressure on baseline income for most cement firms, according to Mr Karmani. @Email:skhan@thenational.ae

Company%20Profile
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The five pillars of Islam

1. Fasting 

2. Prayer 

3. Hajj 

4. Shahada 

5. Zakat 

COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
The%20Killer
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CHELSEA SQUAD

Arrizabalaga, Bettinelli, Rudiger, Christensen, Silva, Chalobah, Sarr, Azpilicueta, James, Kenedy, Alonso, Jorginho, Kante, Kovacic, Saul, Barkley, Ziyech, Pulisic, Mount, Hudson-Odoi, Werner, Havertz, Lukaku. 

THE BIO

Ms Al Ameri likes the variety of her job, and the daily environmental challenges she is presented with.

Regular contact with wildlife is the most appealing part of her role at the Environment Agency Abu Dhabi.

She loves to explore new destinations and lives by her motto of being a voice in the world, and not an echo.

She is the youngest of three children, and has a brother and sister.

Her favourite book, Moby Dick by Herman Melville helped inspire her towards a career exploring  the natural world.

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THE BIO

Family: I have three siblings, one older brother (age 25) and two younger sisters, 20 and 13 

Favourite book: Asking for my favourite book has to be one of the hardest questions. However a current favourite would be Sidewalk by Mitchell Duneier

Favourite place to travel to: Any walkable city. I also love nature and wildlife 

What do you love eating or cooking: I’m constantly in the kitchen. Ever since I changed the way I eat I enjoy choosing and creating what goes into my body. However, nothing can top home cooked food from my parents. 

Favorite place to go in the UAE: A quiet beach.

Jigra
Director: Vasan Bala
Starring: Alia Bhatt, Vedang Raina, Manoj Pahwa, Harsh Singh
Rated: 3.5/5
The specs
 
Engine: 3.0-litre six-cylinder turbo
Power: 398hp from 5,250rpm
Torque: 580Nm at 1,900-4,800rpm
Transmission: Eight-speed auto
Fuel economy, combined: 6.5L/100km
On sale: December
Price: From Dh330,000 (estimate)
Thank You for Banking with Us

Director: Laila Abbas

Starring: Yasmine Al Massri, Clara Khoury, Kamel El Basha, Ashraf Barhoum

Rating: 4/5

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Prophets of Rage

(Fantasy Records)

 

 

Champion%20v%20Champion%20(PFL%20v%20Bellator)
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Miss Granny

Director: Joyce Bernal

Starring: Sarah Geronimo, James Reid, Xian Lim, Nova Villa

3/5

(Tagalog with Eng/Ar subtitles)


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