If the recent analysis of HSBC Holdings is to be believed, there are certainly good news in store for Emaar in near future. According to HSBC, Emaar will be greatly helped because of the increasing demand of apartments and a higher sales figure. The shares of Emaar may actually advance by 27% further in this year, marking the highest increase in last 5 years.
In a note, HSBC stated that rebound in Dubai is for real and the stock recommendation for Emaar was kept at overweight. The note also mentioned that as the Dubai real estate launches are really strong at this moment, Emaar is definitely going to benefit from the same. Incidentally, Emaar is the developer of the tallest tower in the world and each of its shares may actually go up to 6 dirhams, if comments of HSBC become reality. This will mark the highest figures for Emaar since October, 2008, which is actually when the real estate crash in Dubai started. Earlier, the lender predicted each share price of Emaar to be 4.80 dirhams and it is already at 4.74 dirhams now. On 31st January, Emaar announced that its 2012 year profit advanced by 18% after it sold out more than 80% of the projects in 2012. In last month, Emaar sold out all of its units which were offered as part of a luxury hotel development project located in Central Dubai.
In January, the share prices of Emaar have increased by 30%, marking the best start for the company since its initial public offering in 2000. Dubai is currently returning to the large projects which used to dominate the market before the 2008 crash. The Emirate announced its plans of developing the largest mall in the world, around 100 hotels and gardens bigger than the Hyde Park in London. Emaar is going to be a co-developer in this project.
The 14-day relative strength index of Emaar went down to 70 from its earlier value of 72 on today. Many analysts believe a reading below 70 denotes that the security will be declining. As far as the comments of Jones Lang LaSalle are concerned, in 2013, the Dubai based property industry will be witnessing a broader base recovery. Incidentally, in 2002, Dubai allowed expatriates to own property for the first time causing a boom in the real estate industry.