← Market Overview

2287

Governance: D

ENTAJ

Arabian Company for Agricultural and Industrial Investment

25.56 SAR / Share

As of: May 28, 2026

61.0x P/E Ratio Trailing 12 Months

1.6x P/B Ratio Price to Book Value

2.0% Dividend Yield Annual Dividend / Share

766.80M SAR Market Cap Total Valuation

1.32 Beta Systematic Risk Index

1.0% Net Margin Net Profit / Revenue

The Story

A vertically integrated poultry producer undergoing a capital-intensive expansion and public transition, currently prioritizing scale and infrastructure over immediate profitability.

Source: Q3 2026 (2026-04-28)

Value Creation -2.1% Excess Return on Capital (Spread between ROIC/ROE and Cost of Capital)

Cash Flow Payback — Estimated years of operating cash flows required to cover Enterprise Value

Performance & Distributions

Dividend Yield Trailing annual dividends paid relative to share price

2.0%

Sustainable Growth Rate Rate at which company can grow internally using reinvested profits

+11.8%

Payout Ratio Percent of net profits distributed as dividends

119.3%

Net Margin Net profit margin generated from total operational revenue

1.0%

ROIC Return on Invested Capital

6.0%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

61.0x

P/B Ratio Market capitalization compared to corporate book value

1.6x

EV / EBITDA Operating multiple reflecting core operational leverage

14.6x

EV / SALES Asset pricing multiple relative to total topline revenue

1.2x

Growth Story

ENTAJ is currently in an aggressive reinvestment phase, as evidenced by a five-year average reinvestment rate of 197.88%, which significantly exceeds its net operating profit after tax. This heavy capital allocation supports a sustainable growth rate of 11.84%. While revenue has grown from 1.10 billion SAR in fiscal 2023 to 1.28 billion SAR on a TTM basis, the growth is anchored in expanding biological assets, which reached 11.3 million live broiler birds by September 2025. Strategic initiatives, including a 100% share capital payment for the incorporation of the Al Imtiaz Poultry Company joint venture and the leasing of a new vehicle fleet, indicate a focus on long-term capacity building despite the current pressure on net income.

Profitability Dynamics

The company's profitability is currently facing headwinds, with TTM operating margins compressing to 2.85% and net profit margins falling to 0.98%. This margin pressure is reflected in a negative ROIC-WACC gap of -1.80%, suggesting that the company is currently earning less than its 7.78% cost of capital. Value creation has been impacted by operational adjustments, including a 20 million SAR inventory cost correction following a new ERP implementation and a 13.9 million SAR settlement with the General Authority for Competition. Despite these challenges, ENTAJ maintains positive operating cash flows and utilizes government subsidies, which totaled 9.2 million SAR in the first nine months of 2025, to support its production cost structure.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

1.32

Cost of Equity Minimum required rate of return demanded by shareholders

10.1%

WACC Weighted average cost of total debt and equity funding

8.1%

Debt-to-Equity Ratio Proportion of corporate funding financed by debt creditors

103.4%

Risk Factors

ENTAJ faces notable liquidity and leverage risks, with total debt reaching 793.2 million SAR and current liabilities exceeding current assets by 15.7 million SAR as of September 2025. The company's financial position is currently stabilized by formal waivers from banks for covenant breaches related to leverage and current ratios, effective through December 31, 2025. Operational risks are tied to the biological nature of the business, with 95.3 million SAR in biological assets subject to fair value remeasurements. Furthermore, a relevered beta of 1.16 indicates that the company carries a higher risk profile than the broader market, exacerbated by its reliance on short-term loans to fund working capital.

Governance Disclosures

Rating: D

We track 10 key governance and oversight matters for this company in our database.

Significance: 4/10 Info Asymmetry

Financial Reporting Internal Control Omission

A new ERP system implementation led to an error where SAR 20 million in cost of sold inventory was omitted from the records during the first quarter of 2025. The error required subsequent correction in the financial records for the first and second quarters.

Mitigating Factors: The impact was corrected and reflected in the nine-month period results ended September 30, 2025.

Significance: 3/10 Tunneling

Board-Linked Related Party Transactions

The company engaged in various commercial transactions with entities owned by the Chairman and other board members. This includes purchases and rent from AlKhorayef Agriculture Projects Company (SAR 1.15 million total) and sales to Delicious Food Company (SAR 439,804).

Mitigating Factors: Terms and policies for these transactions are approved by the company's management.

For more, click here to view the full governance profile →

In-Depth Analysis