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4164

Governance: C

NAHDI

Nahdi Medical Co.

98.45 SAR / Share

As of: May 28, 2026

15.8x P/E Ratio Trailing 12 Months

4.9x P/B Ratio Price to Book Value

5.7% Dividend Yield Annual Dividend / Share

12.80B SAR Market Cap Total Valuation

0.60 Beta Systematic Risk Index

7.8% Net Margin Net Profit / Revenue

The Story

Nahdi Medical Company combines a dominant retail pharmacy footprint across Saudi Arabia with exceptional capital efficiency, generating high returns on capital while maintaining a conservative, lease-supported capital structure.

Source: Q1 2026 (2026-05-07)

Value Creation +30.7% 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

5.7%

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

+3.9%

Payout Ratio Percent of net profits distributed as dividends

89.7%

Net Margin Net profit margin generated from total operational revenue

7.8%

ROIC Return on Invested Capital

37.7%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

15.8x

P/B Ratio Market capitalization compared to corporate book value

4.9x

EV / EBITDA Operating multiple reflecting core operational leverage

8.2x

EV / SALES Asset pricing multiple relative to total topline revenue

1.3x

Growth Story

Nahdi's growth is characterized by steady, organic expansion of its retail footprint. Revenue has grown consistently from SAR 8.71 billion in FY 2023 to SAR 9.45 billion in FY 2024, reaching SAR 10.21 billion in FY 2025, and further expanding to SAR 10.37 billion on a TTM basis. This steady top-line expansion is supported by a 5-year average reinvestment rate of 10.26%. Combined with an exceptional 5-year average Return on Invested Capital (ROIC) of 37.69%, Nahdi possesses a sustainable growth rate of 3.87%. This indicates that the company can comfortably fund its ongoing retail expansions, such as pharmacy decorations, new store rollouts, and distribution center construction, which are backed by SAR 94.2 million in capital commitments, primarily through its highly efficient internal cash generation.

Profitability Dynamics

The core strength of Nahdi's financial profile lies in its remarkable capital efficiency and value creation. The company boasts a massive 5-year average ROIC of 37.69% against a WACC of 7.03%, creating an extraordinary value-creation gap of 30.66%. This high return profile is driven by stable operating performance, with TTM operating margins at 8.03% and profit margins at 7.82%, translating to TTM net income of SAR 811.26 million. Although operating income experienced a slight compression from SAR 962.54 million in FY 2023 to SAR 845.91 million in FY 2025 due to shifting product mixes and operational investments, the business continues to generate robust cash flows. This cash generation supports substantial shareholder returns, as demonstrated by the distribution of SAR 390 million in cash dividends (SAR 3.00 per share) for the second half of fiscal 2025.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

0.60

Cost of Equity Minimum required rate of return demanded by shareholders

6.9%

WACC Weighted average cost of total debt and equity funding

7.0%

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

13.8%

Risk Factors

Nahdi's risk profile is highly conservative, characterized by a low-beta market sensitivity of 0.60 and a debt profile consisting entirely of lease liabilities rather than traditional bank debt. The latest total debt of SAR 1.77 billion represents right-of-use lease liabilities for its extensive pharmacy network, which are well-matched by a strong liquidity position of SAR 1.12 billion in cash and cash equivalents, including SAR 989.16 million in short-term Islamic Murabaha deposits. Business-specific risks include inventory management, with a provision for inventory obsolescence of SAR 126.61 million as of March 31, 2026, and geopolitical uncertainties in the Middle East that could impact supply chains. However, management has assessed these risks as manageable, with no material threat to its going-concern status.

Governance Disclosures

Rating: C

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

Significance: 2/10 Tunneling

Key Management Personnel Compensation

The Group disclosed compensation paid to key management personnel for the three-month period ended 31 March 2026. The total expense recognized was SAR 5,013,101, which comprised salaries and other benefits of SAR 875,000 and post-employment benefits of SAR 4,138,101. This is compared to a total of SAR 4,508,531 for the three-month period ended 31 March 2025.

Mitigating Factors: Pricing policies and terms of these transactions are approved by the Group’s management.

Significance: 2/10 Info Asymmetry

Beneficial Interest Shareholding in Foreign Subsidiaries

In several foreign subsidiaries (UAE and Egypt), 1% of the shareholding is held by individuals or other Group entities specifically for the 'beneficial interest' of the Parent Company, rather than direct legal ownership.

Mitigating Factors: The arrangement is explicitly disclosed in the basis of consolidation to clarify that the Group maintains 100% effective ownership.

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In-Depth Analysis