← Market Overview

3040

Governance: C

QACCO

Qassim Cement Co.

43.48 SAR / Share

As of: Mar 26, 2026

17.0x P/E Ratio Trailing 12 Months

1.8x P/B Ratio Price to Book Value

7.0% Dividend Yield Annual Dividend / Share

4.77B SAR Market Cap Total Valuation

1.02 Beta Systematic Risk Index

24.5% Net Margin Net Profit / Revenue

The Story

A dominant regional cement producer transitioning from a high-payout cash-cow model to a strategic expansion phase through consolidation and massive capacity upgrades.

Source: Q3 2025 (2025-11-16)

Value Creation +4.6% 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

7.0%

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

-2.6%

Payout Ratio Percent of net profits distributed as dividends

119.2%

Net Margin Net profit margin generated from total operational revenue

24.5%

ROIC Return on Invested Capital

13.6%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

17.0x

P/B Ratio Market capitalization compared to corporate book value

1.8x

EV / EBITDA Operating multiple reflecting core operational leverage

11.7x

EV / SALES Asset pricing multiple relative to total topline revenue

4.1x

Growth Story

The company's growth trajectory has been redefined by the full-period consolidation of Hail Cement, which contributed 221.2 million SAR in revenue during the nine months ended September 30, 2025. This helped drive TTM revenue to 1.15 billion SAR, a substantial increase from the 583.6 million SAR reported in fiscal 2023. Historically, QACCO has operated with a negative 5-year average reinvestment rate of -19.20%, resulting in a sustainable growth rate of -2.60%. This indicates that the business has traditionally prioritized returning capital to shareholders over internal expansion. However, a major strategic pivot is underway, evidenced by capital commitments of 1.25 billion SAR as of September 30, 2025, primarily dedicated to establishing a new 10,000 TPD production line in Buraydah to secure long-term capacity growth.

Profitability Dynamics

QACCO remains a consistent value creator, maintaining a 5-year average ROIC of 13.56%, which provides a healthy 5.15% spread over its WACC of 8.41%. Profitability is supported by robust TTM operating margins of 24.48% and a net profit margin of 24.51%. The company demonstrates strong cash flow generation, which has supported a consistent dividend policy, including three quarterly distributions of 0.8 SAR per share during 2025. Profitability is further bolstered by the 'industrial sector competitiveness initiative,' which provided 48.5 million SAR in support during the first nine months of 2025 to mitigate rising fuel costs, ensuring that the company maintains its competitive cost structure during its transition plan.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

1.02

Cost of Equity Minimum required rate of return demanded by shareholders

8.8%

WACC Weighted average cost of total debt and equity funding

8.9%

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

0.0%

Risk Factors

The company maintains an exceptionally conservative financial profile with total debt of only 2.32 million SAR against a market capitalization of 4.69 billion SAR. This minimal leverage is reflected in a relevered beta of 0.93, suggesting the business is slightly less volatile than the broader market. Primary risks include exposure to fluctuating fuel prices and the execution risk associated with its massive 1.25 billion SAR capital expenditure program. Additionally, the company faces ongoing Zakat assessments, with 2.47 million SAR recorded for fiscal 2021 and pending final assessments for fiscal 2024. The successful integration of Hail Cement has mitigated regional concentration risk, though the company remains sensitive to the cyclical nature of the Saudi construction sector.

Governance Disclosures

Rating: C

We track 4 key governance and oversight matters for this company in our database.

Significance: 7/10 Entrenchment

Equity Issuance for Subsidiary Acquisition

The company issued 20,559,000 new shares at a market value of SAR 58.5 each to acquire 100% of Hail Cement Company, resulting in an increase of SAR 205.59 million in share capital and SAR 997.11 million in additional paid-in capital.

Mitigating Factors: The acquisition was described as a strategic move to enhance market competitiveness and was based on the closing rate of the Saudi Stock Exchange.

Significance: 8/10 Info Asymmetry

Purchase Price Allocation and Goodwill Adjustment

Following the acquisition of Hail Cement Company, the Group completed a purchase price allocation that resulted in a retrospective decrease in goodwill by SAR 173,705,346 and a corresponding increase in property, plant, and equipment and intangible assets.

Mitigating Factors: The adjustments were made in accordance with IFRS 3 measurement period requirements to reflect the final fair value of identifiable assets.

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

In-Depth Analysis