Industries Qatar Surges Most Since 2011 on Dividend: Doha Mover

Industries Qatar QSC climbed to the highest in nine years after the Persian Gulf country’s biggest petrochemicals company boosted its dividend by 42 percent.

The stock gained 7.4 percent to 193.1 riyals, the strongest since May 2005, helping Qatar’s benchmark index add 1.5 percent. About 1.9 million securities traded, eight times the average volume of the last three months, according to data compiled by Bloomberg.

The board recommended a dividend of 11 riyals ($3.02) per share for 2013 compared with 7.73 riyals for the previous year. Full-year profit fell 4.8 percent to 8 billion riyals, below the 8.4 billion-riyal analysts’ estimate.

“I was expecting nine riyals a share so this is a significant positive surprise, much higher than what the regional petrochemical companies usually pay,” Saugata Sarkar, head of research at Qatar National Bank Financial Services, said by phone from Doha today. The company will pay about 83 percent of its profit as dividend and “if the management decides to continue this going forward it will lead to a significant re-rating of the stock,” he said.

Shares have gained 14 percent this year, while the Qatar gauge advanced 13 percent. Riyadh-based Saudi Basic Industries Corp., the region’s largest petrochemicals company, in January also reported 2013 profit that missed analysts estimates.

Industries Qatar profit was less than expected mainly because of lower commodity prices and weaker than anticipated margins on the steel business, said Sarkar, who has a hold rating on the stock.

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