Ever since it reported a 228 per cent rise in second-quarter profits last week, Aldar has been riding high on the markets.
The developer's shares climbed to their highest level in four months last week, standing at Dh1.25 yesterday on the back of the surprisingly good results.
Aldar, which is pondering a US$15 billion merger with the rival Abu Dhabi developer Sorouh, made much of its profits from selling luxury flats to the Government. It has been basking in more good news after the Swiss investment bank UBS rated its 2014 bonds as "buy". The yield on Aldar's 10.75 per cent $1.25bn bonds maturing in May 2014 has fallen 63 basis points this year to 5.18 per cent yesterday.
The UBS analysts Kathleen Middlemiss, Tatiana Boroditskaya and Emmy Al Ghabra put out a note on Friday to say they saw a "marked improvement" in the company's financial performance as it recovered from the global economic downturn. "We believe the bonds do have room to tighten from here," the analysts said.
"We also forecast continued deleveraging from the group and sustained cash flow, which could also warrant an upgrade from the rating agencies."
Other analysts, too, are viewing the company's 2014 bonds positively as the company seeks to put its recent troubles behind it.
The Abu Dhabi Financial Services Company yesterday published its own note on Aldar's results noting the developer was "putting the best foot forward" with its higher than expected delivery.
"Aldar bonds are a good deal at the moment," said Mohammed Ali Yasin, the managing director of Abu Dhabi Financial.
"This news is a positive sign that the financial markets are looking at the company more favourably, which will help it attract more liquidity.
"It reflects favourably on the entire real-estate sector."
