Report
Jaap Meijer
EUR 125.58 For Business Accounts Only

Qatar Gas Company Update - Undervalued strong FCF play


  • Almost 100% downside protected business due to what appear to be long-term watertight contracts with only Qatar semi- sovereign risk.
  • In-house maintenance should increase GPM by 250-300 bps by FY 20e on our estimates.
  • Balance sheet is sound despite high leverage and low interest coverage with improving FCF profile thanks to low CAPEX profile, while going global is not a viable option at current spot rates.
  • Qatar Gas Company is trading at 10% discount to peers (P/E, EV/NOPAT). Maintain Buy on 5.6% div. yield (300bps premium vs. Qatari 10-yr sovereign bond yield) and DPS growth of 3% p.a. with 15% upside to our TP.


Provider
Arqaam Capital
Arqaam Capital

Established in 2007, Arqaam Capital is a specialist emerging markets investment bank, bringing regional and international product offerings to the emerging markets. Arqaam Capital combines international best practice with expertise in the markets in which we operate. Our primary role is to provide financial intermediation and create investment opportunities for frontier and emerging markets investors looking to invest in their own markets and abroad, as well as international investors seeking opportunities in target frontier and emerging markets. Arqaam Capital is headquartered in the Dubai International Financial Centre (DIFC), with additional offices in Libya, Lebanon, Egypt, and South Africa. 

Arqaam Capital's research platform provides the largest coverage footprint of MENA equities and one of the largest on the African continent with a total of 300 stocks under coverage. Arqaam Capital is ranked as one of the leading research providers in the region - a reflection of its broad coverage universe, its in-depth and high quality research, as well the compelling investment ideas that the team generates. The analysts closely analyze their sectors and issue in-depth company and sector research while the strategy team connects the micro with the macro, focusing on index analysis, macroeconomics and strategy research. 

Analysts
Jaap Meijer

Other Reports from Arqaam Capital

ResearchPool Subscriptions

Get the most out of your insights

Get in touch