Itqan Capital said that Almarai Co. managed to maintain growth well with the return of demand to its pre-pandemic levels, supported by the resumption of normal economic activity.
In its commentary on Q1 2022 results, Itqan Capital pointed out that the increase in selling expenses as well as general and administrative expenses during the three-month period came in line with the growth of Almarai's profits, reflecting the company's continued strong cost management.
Almarai’s margins are seen to remain under pressure as costs continue to rise. However, the brokerage expects the company’s profits to continue growing, especially as new acquisitions strengthen its presence in the industry.
The brokerage forecasts Almarai to post SAR 1.91 billion in profits in 2022 and SAR 2.24 billion in the year after. The company is also expected to report profits of SAR 2.85 billion, SAR 3.14 billion and SAR 3.44 billion in 2024, 2025 and 2026, respectively.
Itqan Capital maintained its “Neutral” recommendation on the stock, revising the target price at SAR 52.1.
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