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4011

Governance: B

LAZURDE

Lazurde Company for Jewelry

11.23 SAR / Share

As of: May 28, 2026

— P/E Ratio Trailing 12 Months

2.7x P/B Ratio Price to Book Value

— Dividend Yield Annual Dividend / Share

645.73M SAR Market Cap Total Valuation

3.23 Beta Systematic Risk Index

-1.6% Net Margin Net Profit / Revenue

The Story

L'azurde Company for Jewelry exhibits strong top-line expansion across Saudi Arabia and Egypt, but its financial profile is heavily constrained by thin operating margins, negative net income, and a massive debt-like gold payable structure.

Source: Q1 2026 (2026-05-13)

Value Creation -3.6% 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

—

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

-5.9%

Payout Ratio Percent of net profits distributed as dividends

—

Net Margin Net profit margin generated from total operational revenue

-1.6%

ROIC Return on Invested Capital

3.1%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

—

P/B Ratio Market capitalization compared to corporate book value

2.7x

EV / EBITDA Operating multiple reflecting core operational leverage

86.0x

EV / SALES Asset pricing multiple relative to total topline revenue

0.8x

Growth Story

L'azurde's growth story is an expanding but diluted river. Revenue has shown a strong upward trajectory, rising to TTM Revenue of SAR 3.22 billion from SAR 2.90 billion in FY2025, SAR 2.11 billion in FY2024, and SAR 1.86 billion in FY2023. This top-line expansion is driven by solid performance in key geographical markets, particularly Egypt, which generated SAR 91.8 million in operations revenue for the three months ended March 31, 2026, compared to Saudi Arabia's SAR 76.8 million. However, the company's long-term growth capacity is severely constrained by a deeply negative 5-year average reinvestment rate of -193.10%, resulting in a negative Sustainable Growth Rate of -5.95%. This indicates that the company is not generating the self-sustaining capital required to fund its expansion organically, relying instead on external financing.

Profitability Dynamics

The profitability story resembles polishing a tarnished mirror, where high volumes fail to reflect true economic value. L'azurde struggles to translate its massive revenue into bottom-line profits, as evidenced by a TTM EBIT of SAR 17.58 million, representing a razor-thin Operating Margin of 0.55%. TTM Net Income is deeply negative at SAR -51.95 million, continuing a downward trend from a net income of SAR 30.83 million in FY2023 and SAR 11.70 million in FY2024. Consequently, the company's 5-year average ROIC of 3.08% fails to clear its WACC of 6.69%, resulting in a negative value creation gap of -3.61%. The business model's profitability is highly sensitive to operational costs and gold price fluctuations, leaving the company unable to generate positive economic profit for its shareholders.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

3.23

Cost of Equity Minimum required rate of return demanded by shareholders

18.8%

WACC Weighted average cost of total debt and equity funding

6.7%

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

316.0%

Risk Factors

L'azurde is walking a tightrope of gold, facing an exceptionally high risk profile. The company's relevered beta stands at 3.23, reflecting extreme market sensitivity. It carries a massive total debt of SAR 2.04 billion, which is heavily dominated by accounts payable for gold of SAR 1.96 billion as of March 31, 2026. These gold payables, procured from banks under annual agreements, must be settled in physical gold rather than cash, exposing the company to severe commodity liquidity risks. Additionally, the company utilizes short-term Islamic Tawaruq murabaha facilities of SAR 44.32 million to fund its working capital. With a high cost of equity of 18.77% and negative net income, the company's leverage and operational structure present significant solvency and refinancing risks.

Governance Disclosures

Rating: B

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

Significance: 3/10 Tunneling

Remuneration of Board of Directors and Key Management Personnel

The Group paid or accrued remuneration of SAR 808,069 to the Board of Directors and SAR 1,705,444 to key management personnel during the three-month period ended 31 March 2026. An outstanding balance of SAR 808,069 was due to the Board of Directors as of 31 March 2026.

Mitigating Factors: Transactions with related parties are approved by management, entered in the normal course of business, and conducted on an arm's length basis.

Significance: 4/10 Entrenchment

Nominee Shareholder Agreement in LCJ Qatar

The Parent Company holds a 49% direct ownership interest in L'azurde Company for Jewellery LLC (LCJ Qatar) but is entitled to 98% of the economic benefits of the entity through an agreement with a nominee shareholder.

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

In-Depth Analysis