AL Mal UAE Equity Fund — Fund Information / Factsheet 2024

Feb 8, 2024

Al Mal MENA Equity Fact Sheet January 2024 NAV Per Unit: USD 12.63

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Fund Manager Commentary

In the beginning of a new year, the global economy is still facing ongoing instability due to a series of disruptive events: the pandemic, high inflation, tight monetary policies, the Ukraine conflict, and recent turmoil in the Middle East. However, the IMF has upgraded Saudi Arabia's economic growth forecast, now projecting a 5.5% growth rate for 2025, up from 4.5% in October 2023. Global growth is expected to reach 3.1% in 2024 and 3.2% in 2025. MENA region growth was adjusted slightly, decreasing to 2.9% for 2024 and increasing to 4.2%.

In Jan-2024, Kuwait led the GCC markets with a 6.6% gain, its highest in almost five years. Bahrain followed with a 4.9% increase, while Dubai saw a 2.7% rise despite a strong performance in 2023. Qatar experienced the largest decline at 6.8%, while Saudi Arabia and Abu Dhabi faced contractions due to regional geopolitical tensions and Aramco's oil output cap announcement.

Our holding Al Rajhi bank has kicked off the earning season with results that we relatively in-line and as expected with the current interest rate cycle. Rajhi reported a profit of 4.2bn SAR that was down 5% year on year. Alinma was one of our growth picks and have announced a 35% increase in profitability at 4.8bn in 2023.

As the new year starts, the fund has deployed most of the cash in high conviction calls and is expecting the IPOs to keep hitting the market which will be planned accordingly. The fund remains well diversified with 31 names with financials accounting for 24% of the fund. The top-3 holdings constitute 14.8% of the fund. The fund continued to outperform the market as the fund recorded MTD growth of 1.47% as compared to the benchmark index performance of -0.3% on MTD basis.

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24% - Financials
Sector Allocation 13% - Industrials
12% - Energy
9% - Utilities
9% - Information Technology
7% - Consumer Staples
7% - Communication Services
5% - Materials
5% - Consumer Discretionary
5% - Cash
3% - Real Estate
2% - Health Care
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Geographic Allocation
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65% - Saudi Arabia
17% - UAE
7% - Qatar
5% - Kuwait
5% - Cash
1% - Bahrain
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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	1.5%	-0.3%	1.8%
	YTD3	1.5%	-0.3%	1.8%
	1 Year	21.9%	4.8%	17.1%
	3 Year	54.3%	22.7%	31.6%
	5 Year	73.5%	25.2%	48.3%
	Since Inc.	66.3%	-18.6%	84.9%
1	Performance is net of fees; return	is cumulative
2 3	S&P Pan Arab Composite Index As of 31stJanuary 2024

	Top 5 Holdings Holding ELM Company	% of Fund 5.8
	Saudi National Bank	4.8
	Al Khorayef Water and Power Technologies Company	4.1
	Sahara International Petrochemical Company Saudi Telecom Company	4.1 4.0

		Fund Analysis
	Matrix4 Standard Deviation	Fund 10.7%	Benchmark 11.9%
	Tracking Error	4.9%
	Beta No. of Holdings 4Calculated using 3-year weekly data	0.8 31

		Fund Information
	Fund Manager	Faisal Hasan, CFA
	Inception Date	15th June 2008
	Fund Size	USD 25 million
	Strategy Size	USD 250 million
	Domicile	Bahrain
	Currency	USD
	Subscription & Redemption	Weekly
	Min Subscription	USD 50,000
	Bloomberg Code	MALMENE BI
	Management Fee	1.75%
	Benchmark Index	S&P Pan Arab Composite
	Fund Type	Open Ended
	Administrator	Apex
	Custodian	Standard Chartered

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10Y Fund Strategy Performance
30
Al Mal MENA Equity Fund Benchmark
25
20
15
10
5
0
Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 Jan-20 Jan-21 Jan-22 Jan-23 Jan-24
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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. Suchproducts and transactions are only suitable for sophisticated andknowledgeable professionalusers offinancial instruments, andare structuredand customized to the needs andobjectives ofeachinvestor. The information andopinions containedherein have beenpreparedfor 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 AlMalCapital PSCnor any ofits affiliates, directors, authorized managers and/or employees accepts liability for any loss arising from the use ofor makes any representation as to the accuracy or completeness of the terms and conditions ofproducts 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.

January 2024 NAV Per Unit: AED 1.74

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Al Mal UAE Equity Fact Sheet

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Fund Manager Commentary

In the beginning of a new year, the global economy is still facing ongoing instability due to a series of disruptive events: the pandemic, high inflation, tight monetary policies, the Ukraine conflict, and recent turmoil in the Middle East. However, the IMF has upgraded Saudi Arabia's economic growth forecast, now projecting a 5.5% growth rate for 2025, up from 4.5% in October 2023. This reflects the Kingdom's ongoing economic progress, boosted by its influential leadership. Global growth is expected to reach 3.1% in 2024 and 3.2% in 2025. MENA region growth was adjusted slightly, decreasing to 2.9% for 2024 and increasing to 4.2%.

January was a month that saw continuation of the momentum that’s within the UAE markets as the DFM Index recorded monthly gains of 2.7% while FTSE ADX Index was down 0.7%.

UAE economy remains on strong footing as S&P forecasts UAE's GDP to grow by 5% in 2024, outpacing the expected 2.8% global growth. Non-oil sectors, especially Dubai's Hospitality, Financial Services, and Wholesale & Retail, are expected to drive this growth. In Abu Dhabi, business activity surged in 2023, with 25,647 new economic licenses issued, valued at AED 210 billion, representing a 10.9% increase from 2022. Notably, the Tourism sector saw a significant uptick, with a 22.4% rise in new licenses issued.

As the new year starts, the fund has deployed most of the cash in high conviction calls and is expecting the IPOs to keep hitting the market which will be planned accordingly. The fund remains well diversified with 24 names with financials accounting for 27.8% of the fund. The top-3 holdings constitute 23% of the fund. The fund continued to outperform the market as the fund recorded MTD growth of 0.81% as compared to the benchmark index performance of 0.35% on MTD basis.

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Sector Allocation
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28% - Financials
16% - Industrials
16% - Energy
11% - Real Estate
9% - Utilities
7% - Consumer Discretionary
5% - Cash
3% - Health Care
3% - Materials
2% - Communication Services
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Objective

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

Fund Performance

	Performance1	Fund	Benchmark2	Relative Perf.
	1 Month	0.8%	0.3%	0.5%
	YTD*	0.8%	0.3%	0.5%
	1 Year	15.8%	5.5%	10.3%
	3 Years	45.9%	31.9%	14.0%
	5 Year	82.3%	30.7%	51.6%
	Since Inc.	139.2%	-24.9%	164.1%

1 Performance is net of fees; return is cumulative

2 S&P UAE Domestic 10% Capped Index

3 As of 31st January 2024

Top 3 Holdings

		Top 3 Holdings
	Holding Abu Dhabi Ports Dubai Islamic Bank Adnoc Drilling Company		% of Fund 8.1 7.7 7.2
	Matrix4	Fund Analysis Fund	Benchmark
	Standard Deviation	10.8%	14.7%
	Tracking Error	6.7%
	Beta	0.7
	No. of Holdings	24

4 Calculated using 3-year weekly data

Fund Information

	Fund Manager	Faisal Hasan, CFA
	Fund Size	AED 49 million
	Domicile	UAE
	Currency	AED
	Subscription & Redemption	Weekly
	Min Subscription	AED 40,000
	Management Fee	1.50%
	Performance Fee	20% over 10% hurdle with high watermark
	Financial Year End	31st December
	Benchmark Index	S&P UAE Domestic 10% Capped Index
	Fund Type	Open Ended
	Administrator & Custodian	Standard Chartered

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Geographic Allocation
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57% - Abu Dhabi
37% - Dubai
5% - Cash
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10Y Fund Strategy Performance
Al Mal UAE Equity Fund Benchmark
33
30
27
24
21
18
15
12
9
6
Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 Jan-20 Jan-21 Jan-22 Jan-23 Jan-24
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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. Suchproducts and transactions are only suitable for sophisticated andknowledgeable professionalusers offinancial instruments, andare structuredand customized to the needs andobjectives ofeachinvestor. The information andopinions containedherein have beenpreparedfor 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 AlMalCapital PSCnor any ofits affiliates, directors, authorized managers and/or employees accepts liability for any loss arising from the use ofor makes any representation as to the accuracy or completeness of the terms and conditions ofproducts 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.