Wednesday, Aug 01, 2012
0600 GMT [Zawya Dow Jones]--Bahrain's investment bank SICO says Emaar Properties' increasing exposure to its Indian joint venture Emaar MGF may pose earnings risks going forward. "During 1Q12, Emaar had invested AED183.5 million in compulsory convertible debentures (CCD) issued by EMGF. The conversion of the CCDs, if triggered, will increase Emaar's stake in EMGF to above 50%, though without management control," SICO says in a note. It adds: "Although we believe there is strong demand for Emaar's projects in India, we are concerned about the lack of management's control over the externalities affecting operations." In March, Emaar's EMGF exposure totalled AED5.4 billion, about 28% of its market capitalisation. Maintains buy rating on the stock and a fair value target at AED5.4. Emaar shares closed +0.9% at AED3.4 Tuesday.
(tahani.karrar@dowjones.com; Twitter: @ZDJnews)
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(END) Dow Jones Newswires
01-08-12 0603GMT
