business-data | Edakulathur Michael Johnson

Saudi Cement Company (SCC) has had sales, gross profit, operating profit and net profit during 2005 of SR1.12bn (up 18.7% yoy), SR528.8mn (up 12.6% yoy), SR471.2mn (up 14.8% yoy) and SR484.3mn (up 10.7% yoy) respectively. The company registered a gross profit per tonne of cement sold of SR105.6 in 2005, 4.7% higher than in 2004. SCC is the largest cement company in Saudi Arabia. It has now embarked upon a capacity expansion plan to enhance its clinker capacity by 6.6mtpy. The weighted average share value of SCC of SR133 is lower than SR152 arrived at in our September 2005 Report. However, at the current market price of SR106.00 on the Tadawul, the SCC share is quoting at a discount of 25.8% to its intrinsic value. We, therefore, reiterate our earlier recommendation of ‘Buy’ on the SCC stock. The stock has had a good run at the stock market, touching a high of SR173 over a period of about six months since the release of our September 2005 Report, before the Saudi stock market went for a major correction in late-February-mid-March 2006. In the one month to March 14, 2006, the stock had lost about SR55 (about 35%) touching a low of SR101. The stock has, thus, become attractive at current price levels. In order to view the full report, kindly click on the link below: http://www.globalinv.net/research/SaudiCement-Results-042006.pdf To view more reports on the Kuwaiti and other markets, please visit our website: http://www.globalinv.net