MEED 100 shows recovery on track

27 March 2012

Corporate powerhouses buck economic downturn in 2012 with strong performance

The combined capitalisation of the Middle East’s 100 largest listed companies has climbed 9.4 per cent to $718.5bn in March 2012, from $656.6bn a year earlier.

Although the combined value is still down 16.7 per cent from the $863bn recorded at the height of the economic boom in March 2008, the market is still moving in the right direction. Furthermore, growth has continued amid ongoing regional political unrest and global financial turmoil.

Some bourses have suffered severely over the past 12 months due to the uprisings. This is clearly demonstrated by the fact that of the eight firms to have fallen out of the MEED 100, three are listed in Casablanca, two in Cairo and one in Bahrain. Each of these countries experienced protests to a greater or lesser extent. But overall, this year’s results demonstrate the region has recovered from the worst of the turmoil.

Lingering uncertainty, however, has impacted the number of initial public offerings in the Middle East. In the past three years, more than 200 companies have delayed plans to list. Among them are some large corporates that would surely make the MEED 100.

Since the start of the year, most of the region’s bourses have rallied. Provided this trend continues and the flotations move ahead, the rankings in 2013 could be significantly different to this year.

Furthermore, although Saudi Basic Industries Corporation (Sabic) is certain to retain its position as the region’s largest listed company, Al-Rajhi Bank & Investment Company is coming under increased competition from Qatar’s two biggest firms. Qatar National Bank and Industries Qatar are continuing their ascent up the table. With huge investment planned in the country over the next decade, the two firms are well placed to benefit.

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