MIDEAST STOCKS-UAE's Aldar hits 16-mth low after Q2, downgrade

By Nicolas Parasie

DUBAI Aug 1 (Reuters) - Aldar Properties (ALDR.AD: Quote), the largest Abu Dhabi developer by market value, fell to a 16-month intraday low on Sunday after reporting a hefty quarterly loss and being hit by a ratings downgrade.

Other markets in the Middle East were mixed, with Dubai and Qatar edging lower, while Egypt, Oman and Saudi Arabia rose.

On Thursday, Aldar posted a second-quarter net loss of more than $129 millions, due to lower property sales and investment values. In addition, it was also hit by a rating downgrade by Standard & Poor's. [ID:nWNA6881]

The company's shares ended 1.6 percent lower, recovering slightly after hitting a 16-month low.

"The downgrade reflects our view of the very challenging real estate market conditions in Abu Dhabi," said Standard & Poor's credit analyst Tommy Trask, "and the reliance of Aldar's future earnings and cash flow on continued demand for both sale and rental of property and land".

"Moving into H2 10, Aldar will witness a spike in unit deliveries and the commercial launch of new investment properties - positively impacting the income statement," said Shuaa Securities analyst Roy Cherry.

"However, with the prevailing real estate market conditions, the fact that Aldar remains the most leveraged among the top-three listed UAE developers and the connotations of the premature partial settlement of the AD (Abu Dhabi) government loan - lead us to remain cautious on this name," he added.

Abu Dhabi Commercial Bank (ADCB.AD: Quote) also disappointed investors after reporting a loss for the quarter. [ID:nLDE66U041] Its shares fell 1.2 percent.