Qatari companies continue to rise rapidly in the most valuable global company rankings, according to a QNB Capital analysis of the Financial Times’ (FT) Global 500. The FT compiles an annual and quarterly list of the top 500 companies in the world by market capitalisation, wherein the larger the stock market valuation of a company, the higher it’s ranking.
The most valuable MENA company on the global 500 list is Saudi Basic Industries Corporation (SABIC), with a market capitalisation of US$73.2bn, followed by Al Rajhi Bank and QNB (see graph).
Three Qatari companies (QNB, Industries Qatar and Ezdan) feature in the latest FT global 500 listing, as at 30th September 2011, out of a total of seven MENA companies. Only Ezdan featured in the Global 500 list a year ago. Three Saudi companies (SABIC, Al Rajhi Bank and Saudi Telecom) and one UAE company (Emirates Telecom) are the other MENA entries on the list.
Among the MENA companies, QNB has made one of the fastest gains in the global rankings, reaching 285 as at September 30th 2011, from a ranking of 380 as at June 30th 2011, and 500 as at 31st March 2011.
QNB’s market capitalisation has been boosted by an 11.1% increase in QNB’s share price, despite the collapse in global equity markets. The strong performance of QNB’s share price has been driven by rising profitability as net income at the bank has risen by 30.4% in the year to September 2011 to US$1.5bn for the first three quarters of this year. The increase in QNB’s share price from end-March to end-September accounts for US$2.5bn of the US$7bn increase in its market capitalisation. The remaining US$4.5bn increase in market capitalisation was the result of a rights issue in April, which increased the number of listed shares by 25%.
Other Qatari companies have also performed well in the FT rankings over the last six months. The Qatari economy is well insulated from the economic difficulties facing other regions, presenting Qatari companies with good opportunities for growth and high profitability.
Apple overtook ExxonMobil to become the most valuable company in the world as at 30th September 2011, with a market capitalisation of US$353.5bn (see graph).
The total market capitalisation of the top global 500 companies declined by 17% during the third quarter of 2011, to total US$21.5trn, compared to US$26.0trn as at the end of the second quarter of 2011. The MSCI World index for large cap companies fell by 17.5% over the same period in dollar terms. The decline was a result of the euro-zone debt crisis, coupled with a faltering global economy.
A breakdown of the top global 500 companies by sectors show that banking is the largest sector, accounting for 15% of overall market capitalisation and including 74 companies, followed by oil and gas producers with a 13% share and including 41 companies. US companies dominate the top global 500 list, with a total of 168 companies accounting for 39% of overall market capitalisation. Japanese companies come in a distant second, with a total of 38 companies.