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This spring, the Emirates, and in particular Dubai, came to a standstill. But as of now, the city dedicated to tourists from all over the world is re-emerging and preparing for the end-year festivities.
More importantly, the abating of tensions between some Gulf states and Israel, plus the rescheduled Expo 2020, will favor the commercial activity in the Emirates and, in particular, the tourism industry. Later in the year, higher than usual travel activity is expected to take place because of the Expo. This event could generate better than expected growth and profits for the city.
GDP for the Emirates is down by about 11% for 2020; this occurs on the back of fewer tourists and expats departing. One can expect that the broader recovery will take some time. Amongst the property stocks, there are some hidden gems; Emaar Malls PJSC, the owner of Dubai Mall, is a top pick for EM investors. The stock is trading with a P/E of around 15, and it is cheap: 50% discount when compared with other emerging-market retailers. Other companies worth looking at are Emaar Properties, the developer of Burj Khalifa, which is the world’s tallest building (other developments include some luxury hotels such as The Address and Damac Properties Dubai). Emaar Properties is the owner of Burj Khalifa and other hospitality and entertainment assets while Damac Properties Dubai develops and manages residential and commercial properties.
Knowledge is power.
