Realty stocks profit may top 50% mark
Sector in Dubai sees significant activities in Q1
dubai — Dubai property companies listed on the Dubai Financial Market (DFM) are expected to reveal more than 50 per cent growth in the first quarter financial results on the robust recovery of property market in the emirate, according to average estimates of analysts.
Property developers Emaar Properties and Deyaar Development are expected to declare more than 57 per cent growth in their net profits for the first quarter of 2014 over last year’s same quarter, according to Reuters’ recent poll of analysts.
Dubai property sector witnessed significant activities since the beginning of the last year and this year it also fuelled by major projects announced and sold by listed firms Emaar and Deyaar and non-listed companies Nakheel and Damac Properties. Dubai was the world’s best performing real estate market during 2013 with price growth nudging 35 per cent, Knight Frank has revealed in a new report.
Property prices in some areas of Dubai have now exceeded previous peaks seen in 2008, according to a new report by Jones Lang LaSalle. The real estate consultancy said that the emirate’s residential market maintained its momentum with average prices increasing 33 per cent year-on-year in the first quarter of 2014, with average rents improving 23 per cent.
Emaar, the builder of the world’s tallest tower Burj Khalifa, is expected to declare a Dh666.51 million net profit for the March quarter, compared to Dh555.9 million profit it reported for the same quarter last year, according to EFG Hermes estimates. Its net profit could be more than Dh1.2 billion for March quarter, according to Cairo-based Beltone Financial and it might be Dh744 million as per prediction of SICO Bahrain.
Emaar share price jumped by more than 30 per cent to Dh9.95 in the first quarter of the year with total trades 51,381. Trading value touched Dh10.8 billion with turnover of 1.2 billion shares during the first three months of the year.
Deyaar’s net profit forecast is Dh30.60 million over Dh 19.4 million declared for last March quarter, according to SICO Bahrain. Deyaar stocks price increased by around 32 per cent with total trades 33,210 in Q1 of 2014. Trading value was nearly Dh6 billion and turnover 4.8 billion scrips.
At the DFM, total seven stocks are listed under ‘Real Estate and Construction’ section. Altogether seven securities attracted 252,646 trades during the first three months of the year with trading volume of 21 billion shares worth Dh53.88 billion.
Union property is another devel- oper listed on the Dubai bourse, but its estimates are not available. The stock grew by more than 97 per cent in the first quarter and attracted 66,359 total trades. Total shares transactions crossed Dh7.4 billion and valuing Dh12.7 billion.
DFM-listed Arabtec Holding’s forecast for average growth in net profit is 90 per cent for the first quarter of 2014 compared to same period last year as per Reuters’ polls. Last month, the Dubai construction giant formed a joint venture in Egypt for a housing project with an overall value of $40 billion, or Dh147 billion. Millions of Egyptians will get benefit of this project and have access to full-fledged communities, with public amenities such as schools, hospitals, parks and places of worship.
EFG Hermes predicted Dh118.47 million net profit for Arabtec’s March quarter, compared to Dh 62.5 million reported by the contractor for March quarter last year. Beltone Financial predicted Dh133 million for the quarter while SICO Bahrain expects Dh104.60 million net profit for the first quarter of 2014.
Drake & Scull, which is another DFM-listed firm under ‘real estate and construction sector’ is very active in the property sector in the UAE and other parts of the region. The company offers end to end solutions that provide integrated design, engineering and construction disciplines.
EFG predicted more than 12 per cent growth in Drake & Scull net profit for the first quarter of 2013 over Dh56 million declared for the same period last year.