RDR Capital’s MENA portfolio is up 5.7% in the first six months of 2017 (1H17) and up 22.6% since inception (the portfolio was incepted on the 1st of October 2016). Our global portfolio is up 0.6% in 1H17 in GBP terms (up 6.3% in USD terms) and since inception (the portfolio was incepted on the 1st of January 2017).
The MENA portfolio rebounded during the second quarter of 2017
The Middle East and North Africa (MENA) portfolio rebounded during the second quarter of 2017, supported by a strong performance in Saudi shares on the back of a number of catalysts including a smooth transition in the succession process in Saudi Arabia, the potential of Saudi Arabia being added to the MSCI Emerging Markets index in June 2018, and the Saudi government’s reinstating of benefits to civil servants and military personnel. Saudi consumer shares including Almarai and Savola performed very well during the quarter as consumer confidence and business sentiment improved with the reversal of the pervious austerity measures. In addition, Samba and NCB performed well on the potential of the shares being included in the MSCI EM index next year. The banks were also supported by an easing in liquidity in the system and the potential of a boost in Net Interest Margins (NIMs) on the back of higher interest rates, in line with US interest rates.
Jarir’s share price was supported by strong 1Q17 results. Revenues grew by 20.3% YoY during the quarter, supported by both new store openings and like-for-like growth of old stores. We remain positive on the prospects of the well managed retailer. (more…)