Executive Summary
Subsequent to our note published in July 2017, we have updated the values of equity risk premiums and cost of capital to reflect the changes in current operating environment. Cost of capital (under the implied ERP method) decreased for most GCC countries in comparison with H1 2017 values, with Qatar and Kuwait being the exceptions. This drop in cost of capital could be attributed to the overall reduction of risk premiums (Damodaran). Despite the ratings downgrade for Oman, the WACC has decreased in under both CDS and rating method.
