Masraf Heads for 2011 High as Profit Tops Estimates: Doha Mover

Masraf Al Rayan headed for the highest level since December 2011 after Qatar’s biggest Shariah-compliant bank by market value reported second-quarter profit that beat estimates.

The shares increased 1.3 percent, the most in a month, to 28.10 riyals at 12:08 p.m. in Doha. Volume climbed to 1.2 million shares, twice the stock’s three-month daily average. Masraf Al Rayan, which offers banking services that comply with Islam’s ban on interest, was the second-biggest gainer on the benchmark QE Index, which was little changed.

The Doha-based lender’s net income for the three months ended June 30 grew 13 percent to 421 million riyals, exceeding the 419 million-riyal average estimate of five analysts compiled by Bloomberg. Masraf Al Rayan’s profit has beat estimates in the last three quarters, data compiled by Bloomberg show.

Masraf’s results were “a positive surprise,” Jaap Meijer, Dubai-based director of equity research at Arqaam Capital Ltd., said in an e-mailed note. The financial results reflect “healthy asset quality and continued ability to reduce funding costs to overcome asset yield pressure.”

Qatari bank lending may rebound from the slowest in almost two years as the country’s new leadership invests $200 billion in infrastructure before the 2022 soccer World Cup, according to analysts including Akber Khan, director of asset management at Al Rayan Investment in Doha.

Arqaam has a hold recommendation on Masraf shares, with a price estimate of 25.9 rials. Four other analysts also say to hold the lender’s stock, while one advises buying and three say sell, according to data compiled by Bloomberg.

To contact the reporter on this story: Robert Tuttle in Doha at rtuttle@bloomberg.net

To contact the editor responsible for this story: Lars Paulsson at lpaulsson@bloomberg.net

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