Daman Uae Value Fund Ends 3rd Financial Year With Record Growth Of Over 40%

Fund grows 9.55% during First Quarter; Dividend Raised To AED 3.25 per share – Highest Level Ever

Dubai – United Arab Emirates: The Daman UAE Value Fund – a premium mutual fund vehicle that invests in UAE stocks – has shown a record rise of 40.9 per cent for its third financial year.

The Fund announced its results for the year ending 31st March 2004 at a media briefing here today. Riding on the success of its investment strategy, the managers of the Fund have declared a first quarter dividend of AED 3.25 a share, up 50 fils from its last dividend paid out for the 4th quarter of 2003. This is a record dividend payout during three years of uninterrupted quarterly dividends during the life of the Fund.

Mr. Shehab M. Gargash, Director of Daman UAE Value Fund, pointed out that the 40.9 per cent growth has exceeded the performance of the Fund’s target benchmark NBAD Index, which itself increased by 39.24 per cent for the same period, and comes on the heels of a market surge that reflects investors’ positive sentiment towards the UAE economy.

Daman’s flagship Fund closed its third financial year on 31st of March 2004 showing a total growth since inception of 86.54 per cent, which is equivalent to an annualised growth rate of 31.47 per cent during the life of the Fund..

During March, the Fund grew 2.49%. The cum-dividend NAV as of 31st March was AED 163.29 per share, up AED 3.96.

The Fund’s ex-dividend Net Asset Value (NAV) as of 1st April 2004 is AED 160.04 per share. Year-to-date return stands at 9.55 per cent.

 Dividend Track Record

“Following successful strategies in the buoyant UAE markets, we are pleased to further increase the Fund’s distributions to its investors to a record AED 3.25 per share.” Mr. Gargash announced. The quarterly dividend at AED 3.25 per share is higher by over 18 per cent against AED 2.75 per share paid out for the previous quarter.

Mr. Gargash pointed out that: “The increased dividend distribution reinforces the Fund’s commitment to ensuring that investors receive the benefits of its excellent performance to date. The Fund’s performance since inception has permitted the quarterly distribution of dividends totalling AED 26.50 per share.”

The higher dividend translates to a dividend yield of 7.96 per cent. The dividend is paid out four times a year in cash. “Since inception in 2001, we have not missed a single quarter of dividend payouts,” Mr. Gargash pointed out.

The Fund also announced that the Manager has elected to extend the life of the Fund for an additional two years for a total of five years. This extension comes on the heels of the positive performance, and is an option exercisable by the Manager as per the terms of the Fund’s placement memorandum.  The Fund may not be expanded beyond its maximum life of 5 years, and will now wind up its operations as of July 1, 2006.

The UAE stocks are expected to continue to further build upon the buoyant trend that has been witnessed in the just finished first quarter of 2004. The continued strong growth prospects have been boosted by strong corporate fundamentals and excellent results announced by UAE firms, especially listed ones, for the year 2003.

Stocks Rally

“ The growth in the UAE market since the start of the year will continue, reflecting strong liquidity, positive sentiment of investors, increased activity in the primary markets and the completion of over-the-counter share listing activity in the UAE,” he stated.

“Additionally, the continued introduction of GCC-wide funds will see further liquidity in the markets and upward price movement,” the fund director pointed out.

Recently, there have been a spate of new mutual funds, including Daman’s own IFA Khaleeji Fund, that aim to tap into the growth prospects of the diverse Gulf markets by providing investors with a single entry vehicle.

Shift In Investor Positions

He expected a significant redefinition of investor positions in certain shares due to shifts in weights brought about by several events, most notably the loss of Etisalat’s monopoly, the diversification of Emaar’s portfolio, the emergence of new companies such as Amlak and the listing of the remaining unlisted scrips.

“New investors are injecting increased liquidity, corporate performance continues to impress, PE ratios are still reasonable, borrowings remain cheap and banks are getting more comfortable with lending to stock market operators – all these are tickets to continued activity in the equities market over the coming period,” stated the Daman UAE Value Fund Director.

Performance of selected UAE Mutual Funds and Benchmark Index

(1st July 2001 – 31st March 2004)

Daman Emirates Equity Fund NBADFund NBAD Index
Since 1 July 2001 86.54% %55.91 %79.51 94.25%
YTD 2004 9.55% %2.52 %8.72 6.01%

Key Daman UAE Value Fund performance data (31 March 2004)

Daman UAE Value Fund Data
Current NAV Price (April 1, 2004) AED160.04./share
Total Dividend Distributed Since Inception AED26.50/share
Dividend Distributed, 2004 AED3.25/share
Annualized Dividend Yield 7.96%
Performance, YTD 2004 9.55%
Performance of benchmark NBAD Index, YTD 2004 6.01%

 

About Daman UAE Value Fund

Daman UAE Value Fund is a closed-ended, offshore mutual fund focused on the UAE stock market. It was launched on 1st July 2001 with shares valued at a par value of AED100. The Fund commissions an independent audit of its Net Asset Value (NAV) at the end of each month, and releases monthly NAV statements. The Fund has announced eleven quarterly dividends totalling AED26.50 per share, the most recent being AED3.25 per share for the First Quarter of 2004.

Daman UAE Value Fund is a Mauritius-registered public company. The Fund’s governance structure is designed to ensure maximum transparency and accountability to shareholders.

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