← Market Overview

2320

Governance: B

ALBABTAIN

Al-Babtain Power and Telecommunication Co.

64.80 SAR / Share

As of: May 28, 2026

8.1x P/E Ratio Trailing 12 Months

2.9x P/B Ratio Price to Book Value

4.6% Dividend Yield Annual Dividend / Share

4.14B SAR Market Cap Total Valuation

0.93 Beta Systematic Risk Index

17.2% Net Margin Net Profit / Revenue

The Story

Al-Babtain Power and Telecommunications Company is a diversified industrial manufacturer delivering robust revenue growth and expanding operating margins across the Middle East and North Africa.

Source: Q1 2026 (2026-05-13)

Value Creation +5.4% 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

4.6%

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

+18.7%

Payout Ratio Percent of net profits distributed as dividends

37.5%

Net Margin Net profit margin generated from total operational revenue

17.2%

ROIC Return on Invested Capital

13.9%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

8.1x

P/B Ratio Market capitalization compared to corporate book value

2.9x

EV / EBITDA Operating multiple reflecting core operational leverage

7.3x

EV / SALES Asset pricing multiple relative to total topline revenue

1.6x

Growth Story

Al-Babtain's growth trajectory resembles a high-voltage transmission line, steadily expanding its reach and capacity. Revenue has climbed consistently from 2,490,493,706 SAR in FY 2023 to 2,812,476,486 SAR in FY 2024, and further to 2,857,416,540 SAR in FY 2025, culminating in a TTM revenue of 2,974,069,183 SAR. This upward momentum is supported by strong interim performance, with revenue for the three months ended March 31, 2026, reaching 747,884,409 SAR, up from 631,231,766 SAR in the prior year's corresponding period. This expansion is primarily anchored in its home market of Saudi Arabia, which contributed 634,472,624 SAR of the quarterly revenue, alongside growing contributions from Egypt and other GCC nations. With a five-year average reinvestment rate of 134.33% and a five-year average return on invested capital (ROIC) of 13.89%, the company exhibits a sustainable growth rate of 18.65%, demonstrating its capacity to self-fund and sustain its long-term industrial expansion.

Profitability Dynamics

The company's profitability story is one of increasing efficiency, akin to an optimized power grid minimizing transmission losses. Operating income has surged from 315,985,297 SAR in FY 2023 to 577,891,642 SAR in FY 2025, with TTM EBIT reaching 620,174,844 SAR. This operational leverage has driven the TTM operating margin to 20.85% and the net profit margin to 17.18%. Value creation is underscored by a positive spread between the five-year average ROIC of 13.89% and a WACC of 8.49%, yielding a value-creating gap of 5.40%. Net income for the three months ended March 31, 2026, rose to 143,259,281 SAR from 88,199,215 SAR in the same period of 2025, translating to a basic EPS of 2.24 SAR. This strong profitability translates into robust cash generation, supported by a NOPAT of 575,319,086 SAR, which comfortably funds ongoing capital expenditures, such as the 99,185,656 SAR in capital additions recorded in the audited period of 2025.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

0.93

Cost of Equity Minimum required rate of return demanded by shareholders

8.4%

WACC Weighted average cost of total debt and equity funding

8.5%

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

19.7%

Risk Factors

Managing risk for Al-Babtain is like engineering structures to withstand severe wind loads. The company carries a total debt of 815,482,838 SAR against a cash balance of 143,687,507 SAR, resulting in a net debt position that requires careful liquidity management, especially given a current working capital of 1,407,526,969 SAR. The cost of debt stands at 9.18% after-tax, which is slightly higher than its cost of equity of 8.35%, reflecting the prevailing interest rate environment and the capital-intensive nature of manufacturing. However, a relevered beta of 0.93 indicates that the stock exhibits slightly lower volatility than the broader market. Business-specific risks include exposure to foreign currency fluctuations, particularly in its Egyptian operations where it holds significant assets and subsidiaries, and transaction risks with related parties, such as Al Babtain Contracting Company, which accounted for 7,516,669 SAR in sales during the first quarter of 2026.

Governance Disclosures

Rating: B

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

Significance: 2/10 Tunneling

Board and Executive Management Compensation

The company disclosed payments to key management personnel for the period ended 31 March 2026, consisting of SAR 1,200,000 in remuneration for Board and committee members, and SAR 1,849,085 in salaries, wages, and equivalents for executive management.

Significance: 4/10 Info Asymmetry

Related-Party Transactions and Balances with Al Babtain Contracting Company

The company disclosed sales of SAR 7,516,669 to its affiliate, Al Babtain Contracting Company, during the period ended 31 March 2026, with collections of SAR 287,692. This activity contributed to an increase in the outstanding balance due from the affiliate to SAR 10,995,222 as of 31 March 2026, compared to SAR 2,618,002 as of 31 December 2025.

Mitigating Factors: Transactions are disclosed as being conducted in the ordinary course of business and under terms equivalent to those that prevail in arm's length transactions.

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

In-Depth Analysis