Saudi Arabia’s construction sector is forecast to undergo something of a building boom, fuelled partly by a new wave of petchem projects, as well as a ramping up of government infrastructure spending.
Within the past few weeks alone, announcements have been made approving $16.5bn of transport spending that includes a new metro system for Makkah, a $3.2bn scheme to build hotels and apartments in the same city by Jabal Omar Developments, $370m to develop tourist facilities in Al Oqair, $186m to upgrade electricity supplies around Jeddah and Riyadh, $166.8m on six university projects and $164m on port upgrades.
A new report from Saudi Arabia’s National Commercial Bank shows that the value of construction contracts awarded in H1 2012 was up 50% on last year to $33.8bn
It pointed out that government-backed, infrastructure-related projects, such as schools, hospitals, urban development and roads, contributed around $7.1bn to this figure as the government sought to invest more in infrastructure to boost the broader economy.
Petchem firms remain the key driver of construction spend, though – responsible for 53% ($17.9bn) of all contract awards during the six months, due to major projects such as the extension of the Rabigh II refinery on the Red Sea coast.
Small wonder, then, that construction-related stocks on Saudi Arabia’s Tadawul are enjoying something of a fillip. The index of cement company shares has increased by more than 12% since the start of the year, while property stocks have jumped by more than 30%.
Surprisingly, though, issues at some of the country’s larger contractors has meant the value of firms on the building and construction index have dipped by almost 9%. Over the next few pages, CW takes a look at the 30 biggest construction-related stocks on the market, and how they are faring in terms of their overall worth, profitability and how their shares have performed over the past 12 months. Company prices were taken in the week commencing 12 August.
1. Kingdom Holding Company: Market cap: $11.76bn
2. Jabal Omar Development Company: Market cap: $4.71bn
3. Southern Province Cement Company: Market cap: $3.77bn
4. Saudi Cement Company: Market cap: $3.71bn
5. Dar Al Arkan Development: Market cap: $2.65bn
6. Yamama Cement: Market cap: $2.5bn
7. Yanbu Cement: Market cap: $2.21bn
8. Emaar – The Economic City: Market cap: $2.18bn
9. Qassim Cement Company: Market cap: $1.86bn
10. Makkah Construction & Development Company: Market cap: $1.76bn
11. Knowledge Economic City: Market cap: $1.65bn
12. Eastern Province Cement: Market cap: $1.22bn
13. Arabian Cement: Market cap: $1.13bn
14. Najran Cement: Market cap: $986m
15. Taiba Holding: Market cap: $879m
16. Saudi Ceramics: Market cap: $879m
17. Saudi Real Estate Co.: Market cap: $879m
18. Astra Industrial: Market cap: $762m
19. Tabuk Cement: Market cap: $616m
20. Al Jouf Cement: Market cap:$597m
21. Arriyadh Development Company: Market cap: $587m
22. Saudi Arabian Amiantat: Market cap: $483m
23. Hail Cement: Market cap: $483m
24. Zamil Industrial Investment Market cap: 477m
25. Abdullah AM Al Khodari : Market cap: $448m
26. Mohammed Al-Mojil Group: Market cap: $427m
27. Red Sea Housing: Market cap: $355m
28. United Wire: Market cap: $330m
29. Saudi Cable: Market cap:$320m
30. Saudi Steel Pipes: Market cap: $317m
Construction Week Online