Moroccan real estate mogul Alami Laraq has lost MAD63 million ($7 million) in the past 41 days as shares in Morocco’s largest homebuilder Alliances Developpement Immobiliere (ADI) slumped from record highs.
The multi-million-dollar loss in Lazraq’s stakes can be attributed to a drop in the group’s share price between Sept. 9 and Oct. 21, as investors re-evaluated risks in the real estate and housing sectors amid growing economic uncertainty and supply chain disruptions locally and globally.
ADI is Morocco’s largest home and hotel builder. The group operates through myriad subsidiaries building, marketing and managing commercial and residential assets and tourist properties.
Lazraq, the group’s founder, holds a majority 51.7-percent stake in the company.
Recently, shares in the real estate company surged to a record high price of MAD47.52 on Sept. 9, investors purchased shares in anticipation of an improvement in revenue and profits.
Following the surge in the group’s share price, investor profit-taking actions on the Casablanca bourse led ADI shares to lose at least one-tenth of their value. The price action led to losses for shareholders such as Lazraq.
Data retrieved from the local bourse revealed that ADI shares have declined from a price of MAD47.52 ($5.26) on Sept. 9 to MAD42 ($4.65) as of the time of writing on Oct.21.
As a result, the market value of Lazraq’s stakes has fallen from MAD542.2 million ($60 million) to MAD479.2 million ($53 million).
This translates to a loss of MAD63 million ($7 million) for the multimillionaire.
At the end of its half-year period ending on June 30, the homebuilder posted a profit of MAD45 million ($5 million), 233-percent higher than the MAD13 million ($1.4 million) in profit that it recorded in the first half of 2020.
During the period under review, the group’s consolidated revenue surged by 10 percent to MAD737 million ($81.6 million). It also recorded a total order of 8,143 housing units, which is equivalent to sales of around MAD3.1 billion ($343.1 million).