AL Mal UAE Equity Fund — Fund Information / Factsheet 2021

May 5, 2021

AZ Al Mal MENA Equity Fact Sheet April 2021

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NAV Per Unit: USD 5.92

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Fund Manager Commentary

The US’s S&P outperformed the Dow in April, up 5.2% vs the DOW’s 2.7%, lifted by strong tech results. The macro picture is looking positive with the US reporting Q1 GDP growth of 6.4% (annualized), supported by a healthy increase in government spending, coinciding with a decline in jobless claims to a pandemic-era low. Despite bright macro news, the Fed’s Powell continued his dovish stance, promising it would be “some time” before rates would be increased, thereby moderating the steepening of the yield curve. Nevertheless, Eurozone yields did not follow suit, trending higher on the back of higher than expected inflation data in Germany. European stocks did rise a comparably lower 1.9% over April as a result of additional lockdown measures. Finally, crude rallied 7.5% in April, helping the S&P Pan Arab record a stellar month, up 5.2% and outperforming the MSCI Emerging Markets index which was up 2.4%.

Objective

Achieve capital appreciation, primarily through investment in equity and equity related securities in the Middle East and North African markets.

Fund Performance

			Fund Performance
	Performance1	Fund	Benchmark2	Alpha
	1 Month	3.8%	5.2%	-1.4%
	YTD3	13.4%	16.2%	-2.8%
	1 Year	38.2%	42.4%	-4.2%
	3 Year	15.1%	19.6%	-4.5%
	5 Year	46.6%	36.7%	9.9%
	Since Inc.	18.3%	13.1%	5.2%

1 Performance is net of fees; return is cumulative

KSA’s Aramco concluded a deal to raise USD 12.4bn from a 49% stake sale in a pipeline-rights company, strengthening its balance sheet and unlocking the potential of its asset base, but also raising funds for the country. Banking heavyweights Rajhi reported Q1 profits of SAR 3.3bn, up 40% y/y on the back of solid loan growth, capturing the lion’s share of mortgages. SNB reported standalone results, up 20% y/y, helped by strong non-interest income and lower provisioning charges, compensating for weaker net interest incomes that resulted from spread compression. We continue to like the duo as beneficiaries of both mortgage growth and gov’t CapEx. Another holding, Extra, reported a robust Q1 with revenues climbing 11% y/y, gross margins expanding 127bps and net profit up 2.3x y/y. This came on the back of market share gains, slight improvement in consumer spending, and growth in its consumer finance arm, in line with our thesis on the name.

Egypt’s GERD talks remained in a deadlock as both Egypt and Sudan rejected Ethiopia’s proposal to share data on the operation. The finance minister in Egypt also presented the draft budget for the upcoming fiscal year, targeting a 1.5% of GDP primary surplus and 6.6% GDP fiscal deficit.

Finally, in Qatar, our holding QLMI reported a 37% y/y increase in Q1 21A EPS, fully driven by higher investment income as the core business was weaker with net earned premiums falling 14% y/y on delayed renewals and a reduction in benefits amidst corporate downtrading and downsizing. Near-term weakness is not surprising to us and we continue to like the name as a long-term proxy play on higher medical insurance penetration and mandatory travel insurance with the World Cup 2022 acting as a tailwind.

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Sector Allocation
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36% - Financials
14% - Consumer Discretionary
9% - Materials
9% - Health Care
7% - Industrials
5% - Real Estate
5% - Consumer Staples
5% - Others
4% - Communication Services
3% - Cash
3% - Information Technology
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• 2 S&P Pan Arab Composite Index

3 As of 28th April,2021

Top 5 Holdings

	,	ldi
	Holding	Top 5 Hongs	% of Fund
	Saudi National Bank		7.2
	Mouwasat Medical Services		5.4
	Al Rajhi Bank		5.1
	Saudi Basic Industries Corp		3.7
	United Electronics		3.7
		Fund Analysis
	Matrix4	Fund	Benchmark
	Standard Deviation	13.3%	15.3%
	Sharpe Ratio	0.39	0.0
	Beta	0.8
	Tracking Error	5.4%
	No. of Holdings	54

4 The fund characteristics are based on the historical data of the Al Mal MENA Equity Fund as the AZ Al Mal Equity Fund continues to follow the same strategy; calculated using 3-year weekly data

Fund Information

Investment Manager	Azimut (DIFC) Limited
Investment Advisers	Al Mal Capital PJSC
Fund Manager	Sherif El Haddad
Inception Date	June 26, 2019
Fund Size	USD 68 million
Strategy Size	USD 250 million
Domicile	Luxembourg
Currency	USD
Subscription & Redemption	Weekly
Min Subscription	USD 1 (Retail) -250,000 (Institutional)
Bloomberg Code	AZ3AZUA LX
Management Fee	Up to 2.0%
Benchmark Index	S&P Pan Arab Composite
Fund Type	Open Ended
Administrator & Custodian	BNP Paribas

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20 10Y Fund Strategy Performance
Al Mal MENA Equity Fund
18
S&P Pan Arab Composite Index (Rebased)
51% - Saudi Arabia 16 AZ Al Mal Equity Fund
13% - Egypt
14
11% - Qatar
10% - UAE 12
7% - Kuwait 10
5% - Others
8
3% - Cash
6
Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Dec-19 Dec-20
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Geographic Allocation

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None ofthe information andopinions containedherein is intendedto form the basis for any investment or trading decision, andno specific recommendations are intended. The products andtransactions describedherein are not suitable for every investor. Such products and

Disclaimer

transactions are only suitable for sophisticated and knowledgeableprofessionalusers of financialinstruments, and are structured and customized to the needs and objectives of each investor. The information and opinions contained herein have beenprepared for informational purposes only and do not constitute an offer to sell, or solicitation of an offer to purchase, any security, any commodity futures contractor commodity-related product, any derivative product, or any trading strategy or service described herein.

Neither AlMalCapitalPSC nor any of its affiliates, directors, authorized managers and/or employees accepts liability for any loss arising from the use of or makes any representation as to the accuracy or completeness of the terms and conditions of products and transactions described herein. Finalized terms and conditions are subject to further discussion and negotiation, and will be determined in part on the basis of pricing and valuation models, data, and assumptions that are proprietary to Al Mal Capital and its affiliates. No assurance can be given that a product or transaction can, in fact, be executed on any representative terms indicated herein.

April 2021

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Al Mal MENA Equity Fact Sheet

NAV Per Unit: USD 10.06

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Fund Manager Commentary

The US’s S&P outperformed the Dow in April, up 5.2% vs the DOW’s 2.7%, lifted by strong tech results. The macro picture is looking positive with the US reporting Q1 GDP growth of 6.4% (annualized), supported by a healthy increase in government spending, coinciding with a decline in jobless claims to a pandemic-era low. Despite bright macro news, the Fed’s Powell continued his dovish stance, promising it would be “some time” before rates would be increased, thereby moderating the steepening of the yield curve. Nevertheless, Eurozone yields did not follow suit, trending higher on the back of higher than expected inflation data in Germany. European stocks did rise a comparably lower 1.9% over April as a result of additional lockdown measures. Finally, crude rallied 7.5% in April, helping the S&P Pan Arab record a stellar month, up 5.2% and outperforming the MSCI Emerging Markets index which was up 2.4%.

Objective

Achieve capital appreciation, primarily through investment in equity and equity related securities in the Middle East and North African markets.

	Performance1	Fund	Fund Performance Benchmark2	Alpha
	1 Month	4.1%	5.2%	-1.2%
	YTD3 1 Year 3 Year	12.4% 43.8% 13.5%	16.2% 50.3% 19.6%	-3.8% -6.4% -6.1%
	5 Year	44.6%	36.7%	7.9%
	Since Inc.	17.1%	-24.6%	41.6%

1 Performance is net of fees; 3-year and 5-year return is cumulative

2 S&P Pan Arab Composite Index

KSA’s Aramco concluded a deal to raise USD 12.4bn from a 49% stake sale in a pipeline-rights company, strengthening its balance sheet and unlocking the potential of its asset base, but also raising funds for the country. Banking heavyweights Rajhi reported Q1 profits of SAR 3.3bn, up 40% y/y on the back of solid loan growth, capturing the lion’s share of mortgages. SNB reported standalone results, up 20% y/y, helped by strong non-interest income and lower provisioning charges, compensating for weaker net interest incomes that resulted from spread compression. We continue to like the duo as beneficiaries of both mortgage growth and gov’t CapEx. Another holding, Extra, reported a robust Q1 with revenues climbing 11% y/y, gross margins expanding 127bps and net profit up 2.3x y/y. This came on the back of market share gains, slight improvement in consumer spending, and growth in its consumer finance arm, in line with our thesis on the name.

	1Performance is net of fees; 3-year and 5-year retu 2S&P Pan Arab Composite Index	rn is cumulative
	3As of 28thApril, 2021 Holding Saudi National Bank Mouwasat Medical Services	Top 5 Holdings	% of Fund 7.3 5.7
	Rajhi Bank		5.4
	Saudi Basic Industries		3.9
	United Electronics		3.9
	Matrix4	Fund Fund Analysis	Benchmark
	Standard Deviation	13.5%	15.2%
	Sharpe Ratio Beta	0.3 0.8	0.4
	Tracking Error	5.3%
	Dividend Yield 2020	4.0%
	No. of Holdings	55

Egypt’s GERD talks remained in a deadlock as both Egypt and Sudan rejected Ethiopia’s proposal to share data on the operation. The finance minister in Egypt also presented the draft budget for the upcoming fiscal year, targeting a 1.5% of GDP primary surplus and 6.6% GDP fiscal deficit.

Finally, in Qatar, our holding QLMI reported a 37% y/y increase in Q1 21A EPS, fully driven by higher investment income as the core business was weaker with net earned premiums falling 14% y/y on delayed renewals and a reduction in benefits amidst corporate downtrading and downsizing. Near-term weakness is not surprising to us and we continue to like the name as a long-term proxy play on higher medical insurance penetration and mandatory travel insurance with the World Cup 2022 acting as a tailwind.

4 The fund characteristics are based on the historical data of the Al Mal MENA Equity Fund as the AZ Al Mal Equity Fund continues to follow the same strategy; calculated using 3-year weekly data

Fund Information

	Fund Manager Fund Manager	Sherif El Haddad Sherif El Haddad
	Inception Date Inception Date	15th June 2008 15th June 2008
	Fund Size Fund Size	USD 28 million USD 29 million
	Strategy Size Strategy Size	USD 250 million USD 250 million
	Domicile Domicile	Bahrain Bahrain
	Currency Currency	USD USD
	Subscription & Redemption Subscription & Redemption	Weekly Weekly
	Min Subscription Min Subscription	USD 250,000 USD 250,000
	Bloomberg Code Bloomberg Code	MALMENE BI MALMENE BI
	Management Fee Management Fee	1.75% 1.75%
	Benchmark Index Benchmark Index	S&P Pan Arab Composite S&P Pan Arab Composite
	Fund Type Fund Type	Open Ended Open Ended
	Administrator Administrator	Apex Apex
	Custodian Custodian	Standard Chartered Standard Chartered

Sector Allocation

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37% - Financials
15% - Consumer Discretionary
9% - Materials
9% - Health Care
7% - Industrials
6% - Real Estate
4% - Communication Services
4% - Consumer Staples
3% - Information Technology
5% - Others
1% - Cash
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20 10Y Fund Strategy Performance
18 Al Mal MENA Equity Fund Benchmark
52% - Saudi Arabia 16
13% - Egypt
14
12% - Qatar
12
10% - UAE
7% - Kuwait 10
5% - Others
8
1% - Cash
6
Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Dec-19 Dec-20
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Geographic Allocation
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None ofthe information andopinions containedherein is intendedto form the basis for any investment or trading decision, andno specific recommendations are intended. The products andtransactions describedherein are not suitable for every investor. Such products and transactions are only suitable for sophisticated and knowledgeableprofessionalusers of financialinstruments, and are structured and customized to the needs and objectives of each investor. The information and opinions contained herein have beenprepared for informational purposes only and do not constitute an offer to sell, or solicitation of an offer to purchase, any security, any commodity futures contractor commodity-related product, any derivative product, or any trading strategy or service described herein. Neither AlMalCapitalPSC nor any of its affiliates, directors, authorized managers and/or employees accepts liability for any loss arising from the use of or makes any representation as to the accuracy or completeness of the terms and conditions of products and transactions described herein. Finalized terms and conditions are subject to further discussion and negotiation, and will be determined in part on the basis of pricing and valuation models, data, and assumptions that are proprietary to Al Mal Capital and its affiliates. No assurance can be given that a product or transaction can, in fact, be executed on any representative terms indicated herein.

Disclaimer

April 2021 NAV Per Unit: AED 1.40

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Al Mal UAE Equity Fact Sheet

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Fund Manager Commentary

Dubai and Abu Dhabi equity markets had a strong April, both up 2.2% over the period, on strong performance by some non-index names such as IHC and Emirates NBD which holds a much higher weight in the DFM than in the index. As a result, this did not flow through to the S&P UAE index, which was only up 36bps during April. The S&P revised its assessment of economic risk in the UAE from negative to stable, while affirming a more positive outlook on some UAE banks revising their ratings from negative to stable. April also saw UAE releasing March non-oil private sector growth, which was at its fastest pace since July 2019, boosted by new business and a sharp rise in the construction sector. The UAE PMI rose to 52.6 in March from 50.6 in February, hitting a 20-month high and indicating a solid upturn in business conditions. We continue to remain cautiously optimistic on the economy overall, given the governments swift vaccine roll-out and new initiatives.

Objective

Achieve medium to long-term capital growth by investing primarily in equities listed on the UAE Exchange.

	Performance1	Fund	Fund Performance Benchmark2	Alpha
	1 Month	1.9%	0.4%	1.5%
	YTD3 1 Year 3 Year	13.4% 46.0% 12.3%	10.9% 42.8% -4.0%	2.5% 3.2% 16.3%
	5 Year	31.5%	-7.6%	39.1%
	Since Inc.	69.6%	-42.1%	111.7%

1 Performance is net of fees; return is cumulative

The number of passengers traveling through Dubai International Airport in March decreased 42% y/y to 2.03m, though improving markedly on a sequential basis (+22% m/m). In Q1 21, the number of passengers were down 68% y/y to 5.75m passengers, with aircraft movement down 38% y/y during the quarter. We expect these figures to be further impacted in the near-term following travel bans to and from India on surging cases in the latter country, derailing 300 weekly flights.

Portfolio holding Emirates NBD closed a USD1.75bn three year term-loan priced at a margin of 55 basis points with a ratchet clause of +/-2.5 basis points, contingent on the bank meeting ESG criteria. The facility was launched at an initial size of USD 1bn and was upsized to USD 1.75bn following significant oversubscription. We continue to like the bank’s strong provisioning booked in 2020 and continue to view the bank as a proxy to the Dubai economy, and longer-term rising rate environment via its deposit mix.

Lastly, another portfolio holding, Agthia Group, announced its long-term strategy to become an F&B leader in the Middle East, North Africa and Pakistan (MENAP) region by 2025. The strategy will focus on improving the efficiency of its existing businesses, as well as pursuing new acquisitions in the region. The company is looking to expand into value-added categories to help bolster its water, flour and feed categories to thereby expand EBITDA margins by 100bps per annum until 2025. Agthia is also targeting cost savings of AED 200mn from synergies, portfolio optimization, and better working capital and supply chain management.

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Sector Allocation
39% - Financials
18% - Industrials
16% - Real Estate
8% - Communication Services
8% - Consumer Staples
5% - Consumer Discretionary
3% - Cash
3% - Health Care
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2 S&P UAE Composite Index

3 As of 28th April 2021

	Holding First Abu Dhabi Bank Tabreed	Top 3 Holdings	% of Fund 20.7 13.9
	Emirates NBD		11.9
		Fund Analysis
	Matrix4	Fund	Benchmark
	Standard Deviation	17.5%	23.3%
	Sharpe Ratio Beta Dividend Yield 2020	0.1 0.7 4.5%	-0.2
	No. of Holdings	13

4 Calculated using 3-year weekly data

		Fund Information
	Fund Manager	Sherif El Haddad
	Fund Size	AED 53 million
	Domicile	UAE
	Currency	AED
	Subscription & Redemption	Weekly
	Min Subscription	AED 100,000
	Management Fee	1.50%
	Performance Fee	20% over 10% hurdle with high watermark
	Financial Year End	31st December
	Benchmark Index	S&P UAE Composite Index
	Fund Type	Open Ended
	Administrator & Custodian	Standard Chartered

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Geographic Allocation 10Y Fund Strategy Performance
Al Mal UAE Equity Fund Benchmark
24
22
20
18
46% - Dubai
16
43% - Abu Dhabi
14
5% - KSA
12
3% - Cash 10
3% - Kuwait 8
6
Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Dec-19 Dec-20
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Disclaimer

None ofthe information andopinions containedherein is intendedto form the basis for any investment or trading decision, andno specific recommendations are intended. The products andtransactions describedherein are not suitable for every investor. Such products and

transactions are only suitable for sophisticated and knowledgeableprofessionalusers of financialinstruments, and are structured and customized to the needs and objectives of each investor. The information and opinions contained herein have beenprepared for informational purposes only and do not constitute an offer to sell, or solicitation of an offer to purchase, any security, any commodity futures contractor commodity-related product, any derivative product, or any trading strategy or service described herein. Neither AlMalCapitalPSC nor any of its affiliates, directors, authorized managers and/or employees accepts liability for any loss arising from the use of or makes any representation as to the accuracy or completeness of the terms and conditions of products and transactions described herein. Finalized terms and conditions are subject to further discussion and negotiation, and will be determined in part on the basis of pricing and valuation models, data, and assumptions that are proprietary to Al Mal Capital and its affiliates. No assurance can be given that a product or transaction can, in fact, be executed on any representative terms indicated herein.