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4084

Governance: C

DERAYAH

Derayah Financial Co.

23.37 SAR / Share

As of: May 28, 2026

14.6x P/E Ratio Trailing 12 Months

5.3x P/B Ratio Price to Book Value

5.6% Dividend Yield Annual Dividend / Share

5.84B SAR Market Cap Total Valuation

0.73 Beta Systematic Risk Index

42.8% Net Margin Net Profit / Revenue

The Story

A high-margin, capital-efficient financial services powerhouse that successfully transitioned to a public listing in 2025 while maintaining a dominant position in brokerage and asset management.

Source: Annual 2025 (2026-04-08)

Value Creation +38.1% 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

5.6%

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

+9.0%

Payout Ratio Percent of net profits distributed as dividends

82.1%

Net Margin Net profit margin generated from total operational revenue

42.8%

ROIC Return on Invested Capital

45.3%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

14.6x

P/B Ratio Market capitalization compared to corporate book value

5.3x

EV / EBITDA Operating multiple reflecting core operational leverage

10.9x

EV / SALES Asset pricing multiple relative to total topline revenue

6.4x

Growth Story

Derayah's growth trajectory is characterized by a steady expansion of its core service lines, with total revenue rising from 878.1 million SAR in fiscal 2024 to 934.5 million SAR in fiscal 2025. This growth is underpinned by a sustainable growth rate of 9.04%, driven by an exceptional five-year average ROIC of 45.3% and a strategic reinvestment rate of approximately 20%. The company's expansion is further supported by its 20.4% stake in D360 Bank, representing a long-term play in the digital banking space, even as it currently absorbs a share of losses during its establishment phase. The transition to a Saudi Joint Stock Company and its listing on Tadawul in March 2025 provide a new capital structure to support future scaling of its investment products.

Profitability Dynamics

The company's profitability profile is exceptionally strong, defined by a TTM operating margin of 56.6% and a net profit margin of 42.8%. Derayah is a significant value creator, maintaining a 36.6% positive gap between its return on capital and its 8.66% WACC. While net income saw a moderate decline from 443.9 million SAR in fiscal 2024 to 400.2 million SAR in fiscal 2025, the business remains highly cash-generative. This cash flow capacity is evidenced by the distribution of 320.3 million SAR in interim dividends during 2025. The profitability is bolstered by special commission income, which contributed 329.4 million SAR, highlighting the lucrative nature of its margin financing and securities lending activities.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

0.73

Cost of Equity Minimum required rate of return demanded by shareholders

7.5%

WACC Weighted average cost of total debt and equity funding

7.2%

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

3.6%

Risk Factors

Derayah's risk profile is primarily tied to market volatility and regional geopolitical uncertainties. The company utilizes a Sharia-compliant, unsecured credit facility with a 500 million SAR limit to support operations, with 186.1 million SAR drawn as of year-end 2025. A key structural risk is the consolidation of the Derayah Trading Finance Fund, which creates a 1.3 billion SAR liability representing net assets attributable to third-party unitholders. Additionally, management has noted that regional military escalations have created a high-risk environment that could impact liquidity and asset valuations. Despite these factors, the company maintains a solid regulatory capital ratio of 15.90%, providing a buffer against operational and credit risks, including its 1.1 billion SAR exposure in margin client receivables.

Governance Disclosures

Rating: C

We track 7 key governance and oversight matters for this company in our database.

Significance: 6/10 Asset Risk

Securities Lending Program Risk Exposure

The Group operates a securities lending program where it lends client securities to other financial institutions as an agent. As of 31 December 2025, the fair value of securities lent was SR 1,710 million, supported by SR 1,963 million in collateral.

Mitigating Factors: Collateral is revalued daily and must exceed 100% of the fair value of the securities lent.

Significance: 5/10 Tunneling

Executive Compensation and Share-Based Payments

Key management personnel received SR 26.5 million in short-term benefits and SR 16.4 million in share-based payments during 2025. Additionally, the Board of Directors received SR 1.75 million in remuneration.

Mitigating Factors: Remuneration is disclosed as occurring in the ordinary course of business.

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In-Depth Analysis