The real estate sector in the UAE is dominated by Emaar Properties and Aldar Properties, which represent about 46% of the market value of the sector, which includes 13 companies, according to the financial statements issued by these companies at the end of 2019.
In detail, the latest reports issued by the UAE Central Bank show that the sector’s profitability in general remained in a good position, mainly driven by the strong profits recorded by Emaar Group and Aldar Properties during the year 2019 compared to the positive return on assets and equity.
Regarding the liquidity level of the sector companies, the same report indicates that their indicators also reflected the availability of a stable environment, as the current liquidity ratio reached about 1.7%, and the sector’s indebtedness, compared to the financial leverage ratio, also appears in a good position at a little less than 1%, noting that the leverage ratio It is a liquidity ratio that measures the ratio of total corporate liabilities compared to total equity and capital.
The other positive indicator for the sector was that the interest coverage ratio remained good as well, and this ratio measures the companies’ ability to cover interest payments through their revenues, and it averaged approximately 4.9% during 2019.
In light of the positive indicators of the sector, the share of real estate and construction loans increased and constituted about a third of the total corporate loans portfolio for the banking system.
The growth rate of loans on an annual basis in 2019 for companies in the real estate and construction sector was 11%, compared to 9.8% in 2018.
Follow the economic statement via Google News