MSM firms to dole out RO297m in dividend

13/03/2012 09:40 AST

The overall cash dividend outflow of listed companies on the Muscat Securities Market (MSM) for 2011 stands at about RO296.637 million.

This shows a decline of three per cent, when compared to the previous year, said a research note prepared by Gulf Baader Capital Markets. However, the total cash dividend outflow of MSM30 Index constituents stood at RO240.64 million, an increase of about 2.9 per cent over the previous year.

“This is lower than our estimates of about RO262 million mainly due to lower earnings from the industrial sector majors and the conservative cash dividend policy followed by banking sector players,” added the research note.

At the current MSM index, 2011 dividend yield works out around 4.1 per cent level, which is still attractive.

“The month of March would see the market adjusting for dividends which may limit the upside rally.”

Despite revenue growth of about nine per cent, overall 2011 earnings of MSM 30 Index companies decreased by about 11 per cent on a year-on-year basis. A total of twelve companies in MSM 30 Index provides dividend yield of above five per cent at the current levels, which is an attractive bet.

“Among MSM30 Index constituents, Gulf International Chemicals has the highest dividend yield of about 7.8 per cent at the current levels,” added the research note.

Omantel and Nawras provides yield of 7.1 per cent and 6.1 per cent, respectively, while Cement majors, Oman Cement and Raysut Cement provides dividend yield of about 5.8 per cent and 5.4 per cent, respectively.

Among the banks, National Bank of Oman and Bank Sohar provides higher yields at about 5.6 per cent and 5.3 per cent, respectively.

Oman International Bank provides yield of about 4.4 per cent levels, while DIDIHC provides yield of about 4.3 per cent.

Among the industry sector, Voltamp provides yield of about 4.7 per cent, whereas Al Anwar Ceramics and Dhofar Cattle Feed provides yield of about 4.1 per cent and 3.5 per cent respectively. Asaffa foods provide yield of 2.3 per cent; Galfar to provide yield of 3 per cent levels.

In the banking sector, major bank BankMuscat provides a dividend yield of 3.4 per cent at the current levels. Al Jazeira Services and ONIC provides yield of 2.2 per cent and 1.9 per cent, respectively. Ominvest to provide a yield of 2.4 per cent levels; BankDhofar to provide yield of 1.3 per cent at the current levels.

A total of six companies in MSM provides a dividend yield of above 9 per cent levels, which is very attractive. Among them, Hotel Management and United Power (normal shares) provide yield of about 12 per cent and 11 per cent respectively.

Times of Oman