Al Rajhi Capital sees no changes to MSCI Standard Index in August

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Al Rajhi Capital said it does not expect any Saudi company to be added to the MSCI Saudi Arabia Standard Index. However, it flagged Saudi Kayan Petrochemical Co. as a potential deletion and downgrade to the Small Cap Index.

The firm cited that Saudi Kayan’s SAR 6.9 billion market cap is below the required threshold, adding that the company’s adjusted free float market cap also falls short. Thus, the removal could trigger outflows of about SAR 248 million.

The MSCI review will be announced on Aug. 7, with changes effective Aug. 27.

The firm said Umm Al Qura for Development and Construction Co. (Masar) and Riyadh Cables Co. exceed the total paid-up capital threshold but remain below the free float requirement. However, Riyadh Cables could become eligible if its share price rises by about 25% and meets the adjusted threshold before the November review.

Astra Industrial Group and Aldrees Petroleum and Transport Services Co. may become eligible if their share prices rise more than 30%, assuming the current minimum thresholds remain unchanged, the brokerage added.

Derayah Financial Co., Fakeeh Care Group Co., Zamil Industrial Investment Co., Cenomi Retail Co., and Taiba Investments Co. are candidates for the Small Cap Index but face limited chances due to free float constraints.

The firm added that Halwani Bros. Co., Alamar Foods Co., and Northern Province Cement Co. are close to the deletion threshold but still remain within the required limits.