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6010

Governance: A

NADEC

National Agricultural Development Co.

16.80 SAR / Share

As of: May 28, 2026

13.2x P/E Ratio Trailing 12 Months

1.1x P/B Ratio Price to Book Value

— Dividend Yield Annual Dividend / Share

5.06B SAR Market Cap Total Valuation

0.71 Beta Systematic Risk Index

11.2% Net Margin Net Profit / Revenue

The Story

A vertically integrated agricultural powerhouse transitioning from a traditional dairy focus to a diversified food and protein conglomerate.

Source: Q1 2026 (2026-04-28)

Value Creation -1.7% 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

—

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

+4.4%

Payout Ratio Percent of net profits distributed as dividends

—

Net Margin Net profit margin generated from total operational revenue

11.2%

ROIC Return on Invested Capital

5.6%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

13.2x

P/B Ratio Market capitalization compared to corporate book value

1.1x

EV / EBITDA Operating multiple reflecting core operational leverage

8.1x

EV / SALES Asset pricing multiple relative to total topline revenue

1.3x

Growth Story

NADEC is cultivating a steady expansion, with revenue rising from 3.20 billion SAR in fiscal 2023 to 3.53 billion SAR in fiscal 2025. This growth is fueled by an aggressive five-year average reinvestment rate of 79.48%, as the company pivots toward high-value segments. Strategic initiatives, such as the partnership with Hilton Food Group for protein processing and the 10.41% stake in Arabian Mills, demonstrate a commitment to broadening its long-term growth capacity. While the sustainable growth rate currently sits at 4.43%, the heavy capital allocation into new ventures suggests a strategy aimed at capturing a larger share of the Saudi food basket beyond its historical dairy core.

Profitability Dynamics

The company's profitability profile reflects a period of structural transition and heavy capital expenditure. While the TTM operating margin is healthy at 10.93%, the five-year average ROIC of 5.57% currently trails the WACC of 6.96%, resulting in a value gap of -1.39%. However, recent performance shows resilience, with TTM NOPAT reaching 338.4 million SAR. The company maintains a strong liquidity position with 1.04 billion SAR in cash, supported by Murabaha time deposits yielding up to 5.30%. This cash buffer is critical as the company manages the initial costs of its newer, more capital-intensive joint ventures and biological asset expansions.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

0.71

Cost of Equity Minimum required rate of return demanded by shareholders

7.4%

WACC Weighted average cost of total debt and equity funding

7.3%

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

11.3%

Risk Factors

NADEC operates with a conservative market profile, evidenced by a low relevered beta of 0.635, but faces significant business-specific hurdles. A long-standing legal dispute with Saudi Aramco over land in the Haradh project remains a point of uncertainty, though management believes the impact on core revived lands is limited. Additionally, the business is inherently exposed to climate change risks, including droughts and pests, which it attempts to mitigate through a sustainability strategy focused on solar power and water efficiency. Financially, the company carries 572.4 million SAR in debt, primarily through Islamic Murabaha facilities with the Agricultural Development Fund and SIDF, which are secured by mortgages on land and inventory.

Governance Disclosures

Rating: A

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

Significance: 3/10 Info Asymmetry

Undistributed Rights Issue Compensation

The Group holds funds representing compensation for eligible investors from a rights issue that could not be distributed due to a lack of sufficient bank account information for the beneficiaries.

Mitigating Factors: The amount is held as a liability until the necessary information is obtained to complete the transfer.

Significance: 4/10 Entrenchment

Treasury Share Acquisition for Management Incentives

The Group purchased SAR 21.4 million of its own shares to be allocated to the Employees’ Long-term Incentives Program, intended to align management and employee interests with long-term performance.

Mitigating Factors: The shares are specifically designated for a structured long-term incentive program.

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

In-Depth Analysis