Disappointing corporate results still had its impact on TASI for the beginning of the period; moreover, KayanKayan's IPO had an inadvertently detrimental impact on the Saudi stock market for the first three days of the period. That's because KayanKayan IPO fairly drew ample amount of market liquidity over the subscription period. Many market participants decided to liquidate their portfolios in order to participate in the IPO. This had a negative impact on share prices, which in turn induces other investors to sell off their shares out of fear of more price recession.

TASI soon recovered for the following days driven by blue-chip shares; despite some profit taking witnessed on 2nd of May till the 7th of May, TASI rallied back again until the end of this period, pulled by blue-chips, in particular, SABIC & STC. Both SABIC and STC account for 37% of total market cap, and they both contributed for 2.04% gains of TASI for the period under review.

For the period, 77 shares advanced, 10 shares declined, and 3 shares stood still. Out of 22 trading days, TASI recorded gains on 14 days and losses on 8 days. The highest single-day gain was 2.58% on 28th of April and the highest single-day losses was (-2.74%) on 5th of May. CCFI Top 20 Index gained by 1.54%; the YTD% of the market is still (-2.3%) lower than the start of the year.

Some major developments that took place during the period are as follow:
KayanKayan's IPO oversubscribed by 4 times.

CMACMA clears the way for 8 IPOs of Jabal Omar & 7 Insurance firms.

The new IPOs believed to add depth to sagging trades, minimize speculations and suck up liquidity to control inflation.

CMACMA approved two funds managed by Falcom for Financial Services CompanyFalcom for Financial Services Company.

Malath & Medgulf started trading within the insurance sector; trading those two shares caused the activity within the sector to increase significantly.

SAPTCOSAPTCO, TaibaTaiba, Bank Aljazeerah and SipchemSipchem increased their capital during the period through issuing bonus shares; Almarai increased its capital as a consequence of acquiring Louzeen Co.

Sector performance
For the period under review, Insurance sector gained most, after trades started on Malath and Medgulf stocks within the insurance sector, and appreciated by 71%; followed by Services sector by 11.9%, Agricultural 8.6%, Industrial 7.3%, Telecom 5.5% and finally Cement sector 3.4% over the period. However, Banking and Electricity sectors showed poor performance by (-2.8%) and (-3.9%) respectively. All sectors registered decrease in volume & value except for the Insurance & Telecom sectors. Insurance showed heavy activity in both volume and value. Telecom sector also increased in volume by 25.4% and value by 12.5%. The volume and value for the Electricity sector, however, declined most by (-58.3%) and (-62%) respectively, followed by Cement (-39.8% and - 43.5%), Agricultural (-19.4% and - 27.8%), Services (-15.9% and - 11.8%), and Industrial (-11.6% and -17.3%).

An analysis of the volume-value traded for the period indicates that the average price of Insurance stocks declined by (-66%), while that of Banking and Agricultural stocks declined by (-11.8%) and (-10.3%) respectively over that of previous period. Also Telecom stocks appeared cheaper in average by (-10.3%), Electricity (-8.7%), Industrial (-6.4%), Cement (-6.2%). However, Services sector appeared more expensive compared to the previous period by 4.9%.

Market activity
The market registered trades of 5,404.5 million shares at a value of SR 249 billion. The volume and value traded declined by (-13.97%) and (-16.17%) respectively over the pervious period. The overall market cap was SR 1,205 billion, an increase of 3.64% over the previous period. The market's Price to Earning (P/E) was 15.63 and Price to Book Value (P/BV) was 3.65 for the period.

Performance of five most active stocks
For the period reviewed, the 5 most active stocks together accounted for 17.742% of the total volume traded, 18.89% of the total value traded and 0.4% of the total market capitalization. Al Baha led the market in term of volume traded (206.4 million shares at a value of SR 9.45 billion), followed by HADCO (206.2 million shares at a value of SR 7.7 billion), Shams (201.2 million shares at a value of SR 12.71 billion), Mubarrad (177.2 million shares at a value of SR 8.270 billion) and Wafrah (167.82 million shares at a value of SR 8.85 billion).

Gainers and Losers
As for the top gainers, Thimar topped the list by gaining 77.27%, followed by Al Baha 55.97%, SIECO 52.47%, SADAFCO 37.67%, and Shams 37.67%. On the top losers, the banking sector dominated the list; SHB led the list by dropping (-15.74%) in its price, followed by BSF (-12.45%), SAMBA (-6.67%), SABB (-6.14%), and Riyadh Bank (-4.90%).

Corporate News CMACMA: CMACMA is pleased to announce that it has given its approval to offer seven insurance companies for public subscription as follows: Sanad Cooperative Insurance and Re-insurance Company (Sanad) with a capital of SR 200 million. The number of shares to be offered for public subscription is 8 million shares representing (40%) of the Company's shares. Saudi Arabian Cooperative Insurance Company with a total capital of SR 100 million. No. of shares to be offered for public subscription will be 4 million (40%).

Saudi Indian Cooperative Insurance Company with a total capital of 100 million. No. of shares to be offered is 4 million (40%). Ittihad Al-Khaleej Cooperative Insurance Company with a total capital of SR 220 million. No. of shares to be offered is 8.8 million (40%). Al-ahli liltakaful Company with a total capital of SR 100 million. No. of shares to be offered for subscription is 2,645,000 shares (26.45%). Al-ahlia Cooperative Insurance Company (Al-Ahlia) with a total capital of SR 100 million. No. of shares to be offered for public subscription is 4 million (40%). United Group for Cooperative Insurance (Aseej) with a total capital of SR 100 million. No. of shares to be offered is 4 million shares (40%). The shares of all the above-mentioned companies were offered at a price of SR 10 per share during the period from May 19 to May 28 2007 provided that for the subscription of each company a number of receiving banks not less in number than three banks shall be designated.

In continuation of what CMACMA has announced regarding its keenness to provide investment opportunities to the citizens through approving the offering of Stocks of new companies and listing them in the stock market, CMACMA is pleased to announce that its Council has approved offering Jebel Omar Development Company with a capital of SR 6,714 million. The number of shares to be offered for public subscription will be 201.4 million shares representing 30% of the total Company's shares. The Company's shares will be offered at a price of SR 10 per share during the period June 9 to June 18 2007. The prospectus of the company will be published early enough prior to the start of the subscription.

The prospectus include the information and data needed for the investor to review prior to taking his decision to invest or not to invest in the Company, especially the share price, the financial data of the company in addition to sufficient information on its activities and management.

Falcom for Financial Services CompanyFalcom for Financial Services Company: CMACMA announces that its Council has given its approval to Falcom for Financial Services CompanyFalcom for Financial Services Company to offer its "Falcom Saudi Riyal Murabaha Fund" and "Falcom $ Murabaha Fund".

Saudi French CAM Company Limited: CMACMA Board has issued on May 7 its approval for granting a license to the Saudi French CAM Company Limited to practice the activities of management, advisory services and custody in securities.

Fawaz Abdul Aziz Al-Hokair CompanyFawaz Abdul Aziz Al-Hokair Company: CMACMA has approved the application submitted by Fawaz Abdul Aziz Al-Hokair CompanyFawaz Abdul Aziz Al-Hokair Company for increasing its capital from SR 400 million to SR 700 million through granting three bonus shares against every four shares owned by the shareholders who are registered in the shareholders register as at the end of trading on the day of holding the meeting of the extraordinary general assembly. The amount of increase in capital will be paid by transferring an amount of SR 300 milion from the retained earnings, consequently increasing the number of shares from 40 million shares to 70 million shares provided that the company shall abide by the provision of article 37 (A) of the listing rules. The bonous shares shall be confined to the shareholders who are registered at the end of trading on the day of holding the meeting of the extraordinary general assembly the date of which will be determined later.

TadawulTadawul: TadawulTadawul announces that the Saudi Swiss Securities CompanySaudi Swiss Securities Company has completed all the procedures and technical and legal requirements relating to its listing in the stock market which qualify it to become one of the Saudi brokerage companies that will operate in the Saudi stock market and provide the financial brokerage services and act as a proxy in the market (selling and buying of local shares).

SAPTCOSAPTCO: The Extraordinary General Meeting of SAPTCOSAPTCO Stockholders (the second meeting) has also been held and the following items of agenda have been approved: Article (3) of the Articles of Association of the Company has been amended, the amendment is relating to addition of transport of sand and gravel and selling and purchasing of land and investment in real estates in favor of the Company.

Article (6) of the Articles of Association of the Company has been amended, the amendment is relating to increase of capital from SR 1,000 millions to SR 1.250 millions i.e. an increase rate of 25%, by granting one bonus share for each 4 shares, and hence the shares of the company have increased from 100 Millions shares to 150 Millions shares of a par value of SR 10 per share. The Ex. Dividend date for the bonus shares shall be for those shareholders who own shares at the end of the trading day of Tuesday April 24. The bonus shares were added to the investment portfolios on April 28.

Article (10) of the Articles of Association of the Company has been amended, by confining the trading of the company's shares to the Saudi citizens and non-Saudi residents.

Article (32) of the Articles of Association of the Company has been amended, the amendment is relating to the rate of attendance of the second Meeting of the Extraordinary General Assembly. The attendance rate is amended from 30% to 25% of the Capital's shares.

Saudi Arabian Amiantit Company (Amiantit)Saudi Arabian Amiantit Company (Amiantit): Amiantit - Turkey has obtained recently, through its subsidiary "Subor Co." which Amiantit owns jointly with Yabe Merkizi, nine contracts for big Projects with a total value of SR 260,392,500 ($ 69,438,000).

These contracts are of the biggest contracts to be awarded to "Subor Factory" since its inception 10 years ago. The contracts include the construction of a water (GRP) pipeline of 78,000 meters long in favor of water and sewerage Dept. of Angara City Municipality.

Saudi Advanced Industries Company (SAIC)Saudi Advanced Industries Company (SAIC): The Chairman of SAIC stated that the Company has appointed Samba FinancialGroup as a financial consultant to complete the procedures pertaining to the acquisition of 100% of the ownership of Al-Obeikan Group Company and all its subsidiaries and sister companies against shares to be issued by (SAIC) as announced earlier. An agreement for this purpose was signed with Samba on May 5. The Financial Consultant will prepare the studies and perform the auditing and due diligence pertaining to the acquisition process and follow up with the concerned bodies. It is worth mentioning that, the Obeikan Group has appointed the Saudi Hollandi Bank as a financial consultant for the same purpose.

Aseer Trading, Tourism & Manufacturing Co. (Aseer)Aseer Trading, Tourism & Manufacturing Co. (Aseer): Aseer announces that it has paid an amount of SR 350 million to SAMBA Financial Group- Islamic Banking services, which represents an Islamic Murabaha financing loan which Aseer had obtained at the beginning of 2006 for the purpose of financing its investment in founding Eamar Economic City Company with 35 million shares.

© Saudi Commerce and Economic Review 2007