Bahrain Stock Exchange Securities & Investment Research Weekly Report

GCC markets were in a mixed mood last week. With the near end of the summer vacations and investors awaiting the third quarter results, KSE fell 0.7%, Oman was down 1.2% & Saudi Arabia lost 1%. The UAE and Bahrain appreciated by 1.9% and 0.4% respectively. Investcorp has recently informed us that the financial position of Mondi has deteriorated to such an extent that Mondi has filed a petition for bankruptcy. Mondi (wholly owned by Investcorp and its clients) headquartered in Munich, is a leading international designer, manufacturer and retailer of woman's clothing and accessories. Investcorp confirmed that this bankruptcy will have no financial impact on Investcorp's 1999 financial results, because the exposure to Mondi has been fully covered by existing provisions. Al-Ahli shares were the most talked about during the last fortnight. Heavy buying demand drove the share 6.3% over the period to close at a new all time high of 472 fils. Al-Masa, an Emirati company is to open up three cinema halls in the Al-Alawi complex with a total seating capacity of 600. This BD 0.8m venture will be operational by mid next year. Although this represents direct competition to Bahrain Cinema we do not see the company being threatened in the short run. Bahrain Islamic Bank is to double its capital to BD23 million through a rights issue. The subscription period to the 115m new shares at 175 fils per share (nominal value 100 fils) between 15th and 30th September 1999. Bahrain Islamic Bank share price dropped 3.5% since two weeks due to fear of earning dilution after the rights issue. Trading on Arab International Insurance shares has been temporarily suspended due to the company not convening an AGM and not announcing their 1998 results. The Net Asset Value of SICO Selected Securities Fund as of 9th September was 101.4 fils (0.1% increase from last week).