Savola Group gains on ENBD comments
After two days of lackluster trading, the Saudi Tadawul market index TASI woke up from its lethargy and closed 0.53 per cent higher at 10,716.24 points on Wednesday, Aug. 20.
SABIC was up by 0.30 per cent, finishing at SAR128.75.
Saudi food and beverages giant Savola Group jumped 2.50 per cent to hit SAR82.25.
Earlier in the day, Arjuna Mahendran, the chief investment officer wealth management at bank Emirates NBD, the biggest lender in the UAE, commented on Savola, saying Saudi merger and acquisitions activity is increasing with Savola officially announcing its interest in Kuwait Foods (Americana), as reported earlier last week.
The Saudi food and retail sectors have been outperformers this year (+ 55 per cent year to date) with consensus earnings growth forecast at 25 per cent and 17 per cent for 2014 and 2015, respectively. “We like the defensive nature of the sector, with an average beta of 0.9 and would stay invested in Savola, the GCC’s largest and most diversified food company,” ENBD’s Mahendran.