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Epicure Qatar Equity (QIF)

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Friday 18 January, 2008

Epicure Qatar Equity

Quarterly Report

Epicure Qatar Equity Opportunities
18 January 2008


Epicure Qatar Equity Opportunities plc

Investment Advisers Report - Quarterly Update to Quarter End December 2007

Investment Objective

Epicure Qatar Equity Opportunities plc. ('the Company') was established to
capitalise on attractive investment opportunities in Qatar and the Gulf
Cooperation Council ('GCC') region, due to the economic boom being experienced
in the area. The Company seeks to invest in quoted Qatari equities listed on the
Doha Stock Market ('DSM') in addition to companies soon to be listed, with a
possible allocation of up to 15 percent in regional GCC listed companies. The
Investment Adviser intends to invest using a top-down screening process, as well
as a fundamental industry and company analysis, and does not intend to benchmark
itself to any regional index.

Activities During the Quarter

The Investment Adviser is pleased to report that on popular demand a Qatar
Equity Conference was successfully organised in November 2007 in Doha, which
focused on providing the international investor with a first hand flavour of the
Qatari economic story. The conference received a tremendous response from
investors. The Investment Adviser would like to take this opportunity to thank
the QIA and the leading Qatari companies which presented at the conference, and
also to thank investors for their ongoing commitment to the Company. In the
fourth quarter 2007, the Company successfully completed a secondary issue of
76.17m shares at a price of US$1.1170 per share, raising additional capital of
US$85.08m. This brings the total funds raised since inception to US$256.44m.
Based on the closing price of December 27 2007, the NAV had reached US$1.1387
per share, up 18.11 percent since inception. The Doha stock market experienced
strong performance in 2007, displaying an annual return of 35.48 percent. Strong
fundamentals, in addition to renewed domestic and international interest, have
helped the DSM and other GCC markets post excellent returns for 2007.


Several notable trends during the fourth quarter 2007 have included:


(i) Revaluation of regional currencies

During the fourth quarter the Investment Adviser witnessed increasing
speculation that regional currencies would be revalued upward against their
Dollar peg, by anywhere in the region of 5 to 30 percent. This came to a head
during the GCC summit in early December 2007, as it was expected that the
countries concerned would reach consensus on revaluation. Ultimately there was
no outcome, but the Investment Adviser believes that such a discussion may arise
again, especially if the US undergoes further pressure against global
currencies. The Company would benefit from any such revaluation.


ii) Leverage

Leverage is being used by companies to finance their growth, both for the
purpose of acquisitions, and as a quasi-hedge against any revaluation of the
currency. Despite the credit crunch, the Investment Adviser has witnessed the
ability of companies to raise money at reasonable cost.


(iii) Increasing geographical reach

Either through the establishment of direct operational capabilities or through
acquisitions, the Investment Adviser is increasingly witnessing companies
strengthen their sustainability and growth prospects by increasing their
geographical reach.


(iv) Reporting season

During the first quarter of 2008, all the companies on the DSM will report their
full year earnings for 2007. The anticipation of stock and cash dividends are
expected to be the drivers of performance over the coming months.


(v) Impact of the credit crisis

The Investment Adviser does not believe that the sub-prime effects experienced
by GCC financial institutions will match those being felt across the rest of the
world. Most of the financial institutions in the GCC are relatively regionally
focused in their credit exposure horizons. It is the belief of the Investment
Adviser that any exposure would be immaterial in the larger scheme of the
economic growth in the region.


Industry Breakdown

The Company's investments are focused on those industries which the Investment

Adviser believes will directly benefit from the local expansion underway in the
country. The additional capital which the Company raised in December 2007 has
been substantially deployed in a manner similar to the initial investment
allocations. The remaining capital of sixteen percent is expected to be invested
during the month of January.


The Company is heavily weighted towards the financial services industry, with 35
percent of its overall investment in the banking sector. The services industry
is broadly defined and includes companies in telecommunications, utilities and
other sectors. The Company's exposure to the closely followed real estate sector
is subdued due to current valuations and execution concerns (in the opinion of
the Investment Adviser).


Market Values as of 31st December 2007 Source: Qatar Insurance Company S.A.Q.

The top five investments of the Company constitute 39.88 percent of the gross
funds raised and 43.0 percent of NAV.

Geographical Breakdown

Since the last quarterly report to end September 2007, the Company has received
permission to trade in the UAE and Kuwait markets, and has actively invested in
eight companies listed on these markets. At at 31 December 2007, investments
outside Qatar constitute 10.13 percent of invested funds, distributed across
eight companies. The UAE market has had a good run with a year to date return of
43.8 percent, with Kuwait being a laggard at 24.7 percent year to date.

Important News Flow

Additions to the Doha Securities Market

During the month of December 2007, two new companies were listed on the Doha
Securities Market, taking the total number of companies listed to forty. The
recent additions were the Qatar Oman Company for Investment and Aamal Holding
Company.


Portfolio Companies - update


Qatar Islamic Bank

The company announced that Al Jazeea Islamic, 80 percent owned by the QIB, has
started the initial steps required to transform into a finance company. The
company is in talks with potential investors who have expressed strong interest
in buying equity.


Industries Qatar

Qatar Fertilisers, a subsidiary company of Industries Qatar, has announced that
the company signed a letter with Snamprogetti and Hyundai for the construction
of the QAFCO-5 expansion project. The total estimated cost of the project will
be circa US$3.2bn and the scheduled project completion date is 2010. QAFCO-5
facilities will include an ammonia plant and a urea plant both with a daily
production capacity of 3500 MT, and a number of support utilities. QAFCO-5 is
set to bolster Qatar Fertilisers' position as a world-class producer of
fertiliser and the world's largest single site urea producer.


Masaf Al Rayan

The company has received all the regulatory permissions required for raising the
ownership limit for non-Qataris in the bank's capital from 31 percent to 49
percent. The company has bought a 20 percent stake in Kirnaf Installment
Company, a 1.2bn Saudi riyals consumer finance company that will offer services
such as home, car and goods financing to consumers.


Qatar Telecom

The company successfully closed a US$3 billion syndicated term loan facility.
The facility will be used to refinance the company's existing US$2.5bn bridge
loan signed in March 2007 to finance the acquisition of Wataniya. The five year
term loan carries an initial margin of 0.65% per annum over LIBOR for the first
twelve months and thereafter pricing is tied to a leverage grid, which is
expected to reduce financing costs.


Al Khaliji Bank

The company signed the Sale and Purchase Agreement (SPA) with BLC Bank (France)
to

acquire the banking business conducted by BLC in Abu Dhabi, Dubai Sharjah and
Ras Al Khaimah. The transaction is subject to the regulatory approval of the
Central Bank in Qatar and the UAE.


Barwa Real Estate

The company recently signed a US$700m, one year revolving Islamic loan. Proceeds
of the loan will be used to finance the expansion of Barwa and its ongoing
projects. The company recently proposed to increase its capital by QAR 500m to
QAR 2.5bn. The increase would be through a rights offering. The proposal awaits
ministry and shareholder approval. The company announced that Barwa Capital (UK)
limited, which is 60 percent owned by Barwa Real Estate, was recently granted a
license by the FSA in London. The company will now be in a position to conduct
investment business into and from the UK.


Epicure Qatar Equity Opportunities plc



NAV Update

NAV at launch US$ 0.96

NAV as at 27 December 2007 US$ 1.14

Inception Date 31 July 2007


The NAV is estimated net of fees and expenses every week and announced through
the regulatory news service of the London Stock Exchange.



As at 27 December 2007

Market Price -Shares US$1.15

Market Price -Warrants US$0.60
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Key Features

Domicile Isle of Man

Shares Issued 247,527,523

Warrants Issued 34,271,000

Maturity Continuation vote at 2012 Annual General Meeting

Year End 30 June

Management Fee 1.25% of NAV





Performance Fee

The performance fee is 20% of the of the increase in Adjusted Net Asset Value
per Ordinary Share above the Target Net Asset Value per Ordinary Share, subject
to the achievement of two tests (i) the year end Adjusted Net Asset Value per
Ordinary Share is greater than the High Watermark and (ii) the year end Adjusted
Net Asset Value per Ordinary Share exceeds the Target Net Asset Value per
Ordinary Share during the relevant Performance Period. The Target Net Asset
Value per Ordinary Share for the first performance period is the US$1 placing
price increased by the hurdle rate of 1% per annum. For further details, please
refer to the Company's admission document.


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Investment Manager Epicure Managers Qatar Limited

Investment Adviser Qatar Insurance Company S.A.Q

Administrator Galileo Fund Services Limited I.O.M.

Custodian Anglo Irish Bank Corporation, I.O.M. PLC

Nominated Adviser and Broker Panmure Gordon (UK) Limited

Auditor & Tax Adviser KPMG I.O.M.

Legal Adviser Stephenson Harwood


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Ordinary Shares


ISIN IM00B1240704

SEDOL B124070

Bloomberg ticker EQEO

Valoren 3268997


Warrants


ISIN IM00B1240G96

SEDOL B1240G9

Bloomberg ticker EQEW

Valoren 3271492


Exchange Rate US$1.00=QR3.64


Webpage: www.epicure-qatarequity.com


Contacts


Epicure Qatar Equity Opportunities plc

Leonard O'Brien

T: +41 (22) 908 1190


Nominated Adviser & Broker

Panmure Gordon (Broking) Limited

Moorgate Hall

London, EC2M 6XB

T: +44(0) 207 459 3600


Administrator & Registrar

Galileo Fund Services Limited

Jubilee Buildings

Victoria Street

Douglas

Isle of Man, IM1 2SH


T: +44(0)1624 692600

F: +44 (0)1624 692 601

E: enquiries@galileofs.co.im


Custodian

Anglo Irish Bank Corporation (I.o.M.) PLC

Jubilee Buildings

Victoria Street

Douglas

Isle of Man, IM1 2SH



PR/ Media Contact


Tim Draper

M Communications

Tel: +44 20 7153 1267


Marylene Guernier

M Communications

Tel +44 20 7153 1267


1 Ropemaker Street

Ninth Floor

London

EC2Y 9HT



www.mcomgroup.com


Disclaimer

The contents of this document have been prepared by Qatar Insurance Company
S.A.Q as Investment Adviser to the Epicure Qatar Opportunities Fund PLC ('the
Fund'). This document has been prepared solely for information purposes and for
the use of the recipient. It does not constitute an offer or an invitation by or
on behalf of the investment Adviser or the Fund to any person to buy or sell any
security or investment product. Any reference to past performance is not
necessarily a guide to the future. The information and analyses contained in
this publication have been compiled, or arrived at from sources believed to be
reliable, but the Investment Adviser does not make any representation as to
their accuracy or completeness, and does not accept liability for any loss
arising from their use. The investments discussed in this report may not be
suitable for all investors. and are provided for information purposes only. The
ordinary shares and warrants in the Fund have not been, and will not be,
registered under the United States Securities Act of 1933 as amended (the
'Securities Act') or qualified for sale under the laws of any state of the
United States or under the applicable laws of any of Canada, Australia, Republic
of South Africa or Japan and, subject to certain exceptions, may not be offered
or sold in the United States or to, or for the account or benefit of, US persons
(as such term is defined in Regulation S under the Securities Act) or to any
national, resident or citizen of Canada, Australia, Republic of South Africa or
Japan. None of the Fund, the Manager or any of their respective members,
directors, officers or employees nor any other person accepts any liability
whatsoever for any loss, however arising, from any use of such information or
opinions.


Static Information for Second Page- B Master


Contacts


Epicure Qatar Equity Opportunities plc


Leonard O'Brien

+41 (22) 908 1190


Nominated Adviser and Broker


Panmure Gordon (Broking) Limited

Moorgate Hall

155 Moorgate

London EC2M 6XB


Administrator and Registrar


Galileo Fund Services Limited

Jubilee Buildings
Victoria Street
Douglas
Isle of Man IM1 2SH

T: +44(0)1624 692600
F: +44 (0)1624 692601

enquiries@galileofs.co.im


Custodian


Anglo Irish Bank Corporation (I.O.M.) P.L.C.

Jubilee Buildings
Victoria Street
Douglas
Isle of Man IM1 2SH
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Address for Last Page

Epicure Qatar Equity Opportunities plc

Registered Office
Jubilee Buildings
Victoria Street
Douglas
Isle of Man IM1 2SH




                      This information is provided by RNS
            The company news service from the London Stock Exchange