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June 2, 2021
‘COVID-19’ a catalyst for EdTech industry in GCC region
The EdTech industry is transforming traditional learning methods by blending digital capabilities and the widespread penetration of digital devices within the general population. EdTech platforms have mushroomed to encompass adaptive learning, animated content, gamification, etc (Khaleej Times). The global EdTech market size was valued at USD 89.49 billion in 2020 and is expected to reach USD 106.04 billion in 2021. Which is expected to witness a compound annual growth rate (CAGR) of 19.9% from 2021 to 2028 to reach USD...
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June 1, 2021
ETF’s in GCC: How far have they come?
Exchange Traded Funds (ETF) was first introduced in the year 1993 and since then, it has made a long journey and won the interest and participation of many retail and institutional investors. Currently, there are more than 7,000 ETFs traded globally. The global ETF assets were worth about USD 7 trillion as of august 2020 (https://etfgi.com/news/press-releases/2020/09/etfgi-reports-assets-invested-etfs-and-etps-listed-globally-broke). Today ETFs are available in many countries, based on pure equity or a mix of equity and debt or fixed income instruments or alternative...
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December 8, 2020
Stock Market Commentary: Vaccine optimism drives all markets higher
All GCC equity markets ended the month in green as oil prices jumped by 27% for the month after pharmaceutical firms Pfizer, Moderna and AstraZeneca announced favorable news on COVID-19 vaccine development that rose investor hopes of quick recovery. Kuwait stock markets rose for the month with the Kuwait Main Market index registering a gain of 1.6%. Kuwait All Share index gained of 0.3% while its index PE ratio stood at 20, a premium of 33% compared to S&P GCC...
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July 21, 2020
Estimating Corporate CapEx in Saudi Arabia
COVID-19 has been a double whammy for the Saudi Arabian economy. First, the lockdown and curfew measures has affected the economic activity. Second, because of global lockdown, oil prices fell with the demand for oil falling sharply. Therefore, the output of Saudi corporate sector is also expected to be very much low for the year 2020 if not beyond. Average Fixed Capital Assets held by Saudi Listed Companies(2015-2019) Saudi listed companies held fixed capital assets measured by the average outstanding...
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July 12, 2020
COVID-19 brings to the fore GCC’s Fiscal Vulnerability
Revenue from oil forms significant portion of overall revenue for GCC countries, with 20-year(2000-2019) average at 74%. This dependence on oil as revenue source has long been a pain point for GCC’s fiscal position, surfacing during periods of low oil prices and receding during periods of high oil price.In the backdrop of fall in oil prices due to COVID-19, building a sustainable fiscal policy in GCC has resumed higher importance. Ascend to Prosperity Referred to as black gold, oil has...
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July 9, 2020
COVID-19 may force GCC companies to cut dividend payout
Dividend payments have been an important tool to get investors to buy shares of companies as dividends provide a return on investment even during periods when the markets are down. GCC Companies listed on stock exchanges have provided consistent dividends in recent years. Due to Covid-19, many GCC Companies may be forced to cut dividend payouts due to fall in earnings and need to preserve cash. We examine the impact on dividends due to the pandemic and its ramifications for...
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July 5, 2020
Estimating future returns for Saudi Arabia Stock Market
Need an equity market framework It is a classic mistake that all of us can be guilty of at some point in time. Mistaking historical stock market returns as a good proxy for future returns. While optimism breeds optimism, pessimism breeds pessimism. If we have a great decade (like how S&P 500 is), it will be nearly impossible to be utterly pessimistic and vice versa. Time and again it has been proved that history never repeats but rhymes. However, intuitively...
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June 25, 2020
Edtech – It’s Promise and Future
The EdTech industry is transforming traditional learning methods by blending digital capabilities and the widespread penetration of digital devices within the general population. EdTech platforms have mushroomed to encompass adaptive learning, animated content, gamification, etc. (Khaleej Times). Globally, the EdTech industry recorded a total investment of USD 18.7bn in 2019, following a record of USD 16.3bn in 2018 (Ibid ). It is notable that the combined investments in 2018 and 2019 are greater than the total combined investment recorded from...
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June 10, 2020
Will COVID-19 reduce the appetite for renewable energy projects in the GCC?
The outbreak of COVID-19 has deeply impacted global economies, pushing them into a recession. As health and economic concerns continue to mount, the near-term outlook for renewable energy projects look weak. GCC countries have taken a strong hit in the revenue side of their books due to the sharp fall in oil prices during 2020. The shortfall in revenue and rise in deficits are expected to have a strong near-term impact on project awards in the renewable energy space. GCC...
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June 8, 2020
Implications of COVID-19 on GCC Asset Classes
COVID-19 has rendered economic outlook and companies’ performance projections for 2020 meaningless in a single stroke. Heightened uncertainty has become an everyday reality in the current times. As the coronavirus scare continues, the world is faced with multidimensional issues and tough questions, be it finding an effective treatment for the virus, zeroing in on an optimal quantum of stimulus or deciding the right time to lift lockdowns. With measures like social distancing and lockdowns affecting day-to-day lives of people, asset...