08/03/2016 08:00 AST
Unlike their peers in the region, companies listed on the Muscat Securities Market are maintaining dividend pay-outs either at par with or above last year’s level.
So far, 21 companies in the MSM30 Index companies have announced dividends showing a year on year increase of 11 per cent to reach RO 337.93 million in 2015 against RO 303.38 million.
The remaining companies, except those which make losses, are expected to announce their dividends in the coming weeks. Investors will receive actual payments by the end of this month after the companies hold their general meetings.
For years, investors in Oman have been lured to higher dividend yields by a large number of companies, which averaged 4.3 per cent over the last five years.
Although a final picture will appear only after the annual general meetings, analysts are of the opinion that companies, except a few in the industrial sector, most of them will maintain dividend pay-outs at the level of previous quarters.
“The dividends are in line with the market expectations”, said Suresh Kumar, Head of Research at Al Maha Financial Services.
At the same time, in the banking sector, a couple of banks have increased the payment while others are maintaining the same at previous levels.
While Bank Sohar and Bank Dhofar, which are reportedly in talks for a merger, announced dividends at slightly higher than before, Bank Muscat and National Bank of Oman decided to pay at the previous level.
Bank Sohar said yesterday that its Board of Directors has revised the proposed cash dividend to 5 per cent, i.e, 5 baisas per share and the proposed stock dividend to 10 per cent, i.e, 10 shares per every 100 shares held, instead of the 9 per cent cash dividend and 6 per cent stock dividend proposed earlier for the year 2015.
Meanwhile, reports indicate that corporate dividends in other Gulf countries may be starting to shrink as companies find it harder to raise funds, forcing them to cut payouts.
In 2015 dividend yields in the six-nation Gulf Cooperation Council averaged about 4.5 per cent; the average for emerging markets was 3 per cent, Deutsche Bank estimated.
In Saudi Arabia, total dividend payments by listed companies fell about 5 per cent to 62 billion riyals ($16.5 billion) last year, Riyad Capital calculated.
Outside Saudi Arabia, Industries Qatar , a petrochemicals, metals and fertiliser producer, proposed a 2015 dividend of 5 riyals, down from 7 riyals.
Times of Oman
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