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4326

Governance: A

ALMAJDIAH

Dar Al Majed Real Estate Co.

7.49 SAR / Share

As of: May 28, 2026

10.7x P/E Ratio Trailing 12 Months

2.0x P/B Ratio Price to Book Value

— Dividend Yield Annual Dividend / Share

2.25B SAR Market Cap Total Valuation

1.03 Beta Systematic Risk Index

18.1% Net Margin Net Profit / Revenue

The Story

A newly listed real estate developer delivering solid profitability margins and value creation above its cost of capital, despite recent revenue consolidation.

Source: Q1 2026 (2026-05-06)

Value Creation +5.0% 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

-15.7%

Payout Ratio Percent of net profits distributed as dividends

—

Net Margin Net profit margin generated from total operational revenue

18.1%

ROIC Return on Invested Capital

12.7%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

10.7x

P/B Ratio Market capitalization compared to corporate book value

2.0x

EV / EBITDA Operating multiple reflecting core operational leverage

12.3x

EV / SALES Asset pricing multiple relative to total topline revenue

2.9x

Growth Story

Almajdiah's growth trajectory resembles a shifting blueprint, transitioning from rapid expansion to structural consolidation. Revenue declined from 1,402,306,680 SAR in FY 2024 to 1,223,878,794 SAR in FY 2025, and further consolidated to 1,163,663,899 SAR on a TTM basis. This trend is reflected in a negative 5-year average reinvestment rate of -123.56%, which is typical for real estate developers during phases of cash harvesting from completed projects rather than immediate land acquisitions. Consequently, the sustainable growth rate stands at -15.70%, indicating that long-term growth capacity is currently constrained. However, this consolidation is expected to be counterbalanced by the company's substantial future capital commitments of 1,045,000,000 SAR for inventory properties under development, which represents a significant pipeline for future revenue generation.

Profitability Dynamics

The company's profitability is built on a high-yield foundation, consistently generating returns that exceed its cost of capital. Almajdiah boasts a 5-year average ROIC of 12.71% against a WACC of 7.72%, creating a positive value creation gap of 4.99%. This value creation is supported by robust operating efficiency, with a TTM operating margin of 23.67% and a TTM net profit margin of 18.08%. With TTM EBIT reaching 275,434,276 SAR and NOPAT at 268,884,087 SAR, the company demonstrates strong cash-generation potential from its core operations, particularly through its off-plan property unit sales which continue to serve as a primary driver of profitability.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

1.03

Cost of Equity Minimum required rate of return demanded by shareholders

8.8%

WACC Weighted average cost of total debt and equity funding

7.7%

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

62.6%

Risk Factors

Navigating the structural scaffolding of leverage is a key operational reality for Almajdiah. The company carries a significant debt load, with latest total debt reaching 1,405,611,600 SAR, primarily composed of Murabaha bank facilities with major local financial institutions. While cash reserves stand at 245,819,479 SAR, a substantial portion of this (164.7 million SAR) is restricted cash from off-plan customer payments, requiring regulatory approval from the Off-Plan Sale and Lease Committee before withdrawal. The company's systematic risk is reflected in a relevered beta of 1.03, leading to a cost of equity of 8.81% and an after-tax cost of debt of 5.97%. Additionally, Almajdiah faces business-specific risks, including ongoing reviews of 18.8 million SAR in white land fee invoices and broader regional geopolitical tensions, though management has not identified any material impact on operations to date.

Governance Disclosures

Rating: A

We track 9 key governance and oversight matters for this company in our database.

Significance: 4/10 Entrenchment

Consolidation of Subsidiary with Minority Ownership

The Group holds a 25% ownership interest in Jadet Al Rabea Real Estate Company, with the remaining shares held by two individual shareholders. Despite the minority ownership, the Group consolidates the entity because it manages and controls all operations, financial matters, and strategy.

Significance: 5/10 Propping

Project Financing from Partner in a Subsidiary

The Group received project financing from a partner in a subsidiary (related party to a subsidiary) with a transaction amount of SR 1,534,190 during the period, leading to an outstanding balance of SR 26,910,636 as of 31 March 2026.

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

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In-Depth Analysis