Sahara International Petrochemical Co.’s (Sipchem) revenue is expected to show more resilience after the merger with Sahara Petrochemical, backed by new growth opportunities through Sahara’s subsidiaries, as well as the management intent to enter the US market, Riyad Capital said in a recent report.
“We view international expansion as a necessity for the company to maintain its competiveness,” the report said.
Sipchem has steadily added specialty chemicals to its product portfolio and the trend is expected to continue, the research firm added.
Meanwhile, risks include weak product prices, higher financing costs, currency fluctuations, and exiting of strategic partners.
Riyad Capital maintained a “Buy” rating on the stock with a target price of SAR 24 per share.
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