AlJazira Cap expects Arabian Cement to post SAR 205 mln profit in FY20, maintains ‘Overweight’ rating

Arabian Cement Co. is expected to post SAR 204.6 million in net income for financial year 2020, and SAR 250.6 million in 2021, supported by a strong recovery in Qatrana Cement, Arabian Cement’s Jordan-based affiliate, AlJazira Capital said in a recent report.

Arabian Cement’s Q3 2020 net profit of SAR 78.9 million beat AlJazira Capital’s estimates of SAR 56 million, mainly due to higher-than-expected revenue from Qatrana and lower-than-expected cost per ton, the report said.

The company’s selling prices is expected to sustain at the same level in 2020, the report noted, adding that Arabian Cement had an inventory of 4.1 million tons by the end of Q3 2020.

AlJazira Capital maintained its “Overweight” recommendation on the stock with a target price at SAR 34.10 per share.