Saudi Industrial Investment Group

Saudi Industrial Investment Group SJSC (SIIG) is a Saudi Arabia-based public shareholding company engaged in industrial investment activities. The Company focuses on the industrial base development in the Kingdom of Saudi Arabia, especially petrochemical industries, and opens its export areas to foreign countries, as well as allowing private sector to access other industries using petrochemical industries. The Company is primarily active in the petrochemicals industry. The Company's subsidiaries include National Petrochemicals Company (PetroChem), Saudi Nylon Company, Saudi Benzene Company, Saudi Parazylene Company and Saudi Cyclohexene Company, and its joint ventures included Saudi Chevron Phillips Company, Jubail Chevron Phillips Company and Petrochemical Manufacturing Company Ltd.
  • Ticker2250
  • ISINSA000A0B89Q3
  • ExchangeSaudi Stock Exchange
  • SectorChemicals
  • CountrySaudi Arabia

Analysts

SAUDI INDUSTRIAL INV.GP. sees an upgrade to Slightly Positive due to a better fundamental star rating

The general evaluation of SAUDI INDUSTRIAL INV.GP. (SA), a company active in the Commodity Chemicals industry, has been upgraded by the independent financial analyst theScreener with the addition of a star. Its fundamental valuation now shows 3 out of 4 possible stars while its market behaviour can be considered as moderately risky. theScreener believes that the additional star(s) merits the upgrade of its general evaluation to Slightly Positive. As of the analysis date October 1, 2019, the closing price was SAR 23.38 and its potential was estimated at SAR 26.01.

Rita Guindy

Downgrade rating to Neutral post rally

Stock is up 53% since 1 Nov 16, outperforming market. However further catalysts are limited to a sizeable oil price recovery, in our view. The valuation gap between SIIG and Petrochem, its listed subsidiary [Neutral l TP SAR20], has narrowed to 24% on 2017e EV/EBITDA which can be explained by the lack of visibility on SIIG’s loss-making joint venture PCC, in our view. We revise our forecasts to reflect higher oil prices (2017: USD57.8/bbl), raising our TP by 5% to SAR22.5/share and cutting our rating from Overweight to Neutral. Our TP implies 2017e EV/EBITDA of 6.5x, 20% below peers to account...

Ford Equity International Rating and Forecast Report

Ford Equity International Research Reports cover 60 countries with over 30,000 stocks traded on international exchanges. A proprietary quantitative system compares each company to its peers on proven measures of business value, growth characteristics, and investor behavior. Ford's three recommendation ratings buy, hold and sell, represent each stock’s return potential relative to its own country market.. The rating reports which are generated each week, include the fundamental details behind each recommendation and reflect the fundamental and price data as of the last trading day of the week...

Rita Guindy

Overweight on valuation mismatch vis-à-vis Petrochem

Reiterate Overweight; valuation gap gives c68% upside. At a 9.2x 2016e EV/EBITDA, the price of SIIG’s subsidiary Petrochem [Neutral l TP SAR16.0], implies that the market is assigning no value to SIIG’s other two subsidiaries. It also means that the market is overlooking the expected 11% y-o-y increase in 2016 net income mainly due to the 22% y-t-d styrene price hike, to which Petrochem is negatively exposed. Our target price of SAR21.5/share implies 2016e EV/EBITDA of 7.7x, 10% below the industry, to account for corporate structure complexity and limited disclosure.

Youssef Tawfick

Initiate at OW: Market values non-listed subsidiaries at a c37% discount to GCC petchems

Naturally hedged. SIIG has a 50% stake in 3 integrated operations: Saudi Chevron Philips (SCP), Jubail Chevron Philips (JCP) and the publicly traded Petrochem [PETROCH AB | UW | TP SAR30.0]. JCP sources its benzene requirements from SCP, while Saudi Polymers (Petrochem’s operating arm) receives its styrene needs from JCP, so SIIG’s operations are intertwined in such a way that renders the holding level naturally hedged to price changes in benzene and, to a lesser extent, styrene; together 34% of 2015e revenue. Since 2008, c30% of global styrene capacity (high-cost in W. Europe and Asia) has be...

Rita Guindy

Downgrade rating to Neutral post rally

Stock is up 53% since 1 Nov 16, outperforming market. However further catalysts are limited to a sizeable oil price recovery, in our view. The valuation gap between SIIG and Petrochem, its listed subsidiary [Neutral l TP SAR20], has narrowed to 24% on 2017e EV/EBITDA which can be explained by the lack of visibility on SIIG’s loss-making joint venture PCC, in our view. We revise our forecasts to reflect higher oil prices (2017: USD57.8/bbl), raising our TP by 5% to SAR22.5/share and cutting our rating from Overweight to Neutral. Our TP implies 2017e EV/EBITDA of 6.5x, 20% below peers to account...

Rita Guindy

Overweight on valuation mismatch vis-à-vis Petrochem

Reiterate Overweight; valuation gap gives c68% upside. At a 9.2x 2016e EV/EBITDA, the price of SIIG’s subsidiary Petrochem [Neutral l TP SAR16.0], implies that the market is assigning no value to SIIG’s other two subsidiaries. It also means that the market is overlooking the expected 11% y-o-y increase in 2016 net income mainly due to the 22% y-t-d styrene price hike, to which Petrochem is negatively exposed. Our target price of SAR21.5/share implies 2016e EV/EBITDA of 7.7x, 10% below the industry, to account for corporate structure complexity and limited disclosure.

Youssef Tawfick

Initiate at OW: Market values non-listed subsidiaries at a c37% discount to GCC petchems

Naturally hedged. SIIG has a 50% stake in 3 integrated operations: Saudi Chevron Philips (SCP), Jubail Chevron Philips (JCP) and the publicly traded Petrochem [PETROCH AB | UW | TP SAR30.0]. JCP sources its benzene requirements from SCP, while Saudi Polymers (Petrochem’s operating arm) receives its styrene needs from JCP, so SIIG’s operations are intertwined in such a way that renders the holding level naturally hedged to price changes in benzene and, to a lesser extent, styrene; together 34% of 2015e revenue. Since 2008, c30% of global styrene capacity (high-cost in W. Europe and Asia) has be...

SAUDI INDUSTRIAL INV.GP. sees an upgrade to Slightly Positive due to a better fundamental star rating

The general evaluation of SAUDI INDUSTRIAL INV.GP. (SA), a company active in the Commodity Chemicals industry, has been upgraded by the independent financial analyst theScreener with the addition of a star. Its fundamental valuation now shows 3 out of 4 possible stars while its market behaviour can be considered as moderately risky. theScreener believes that the additional star(s) merits the upgrade of its general evaluation to Slightly Positive. As of the analysis date October 1, 2019, the closing price was SAR 23.38 and its potential was estimated at SAR 26.01.

Ford Equity International Rating and Forecast Report

Ford Equity International Research Reports cover 60 countries with over 30,000 stocks traded on international exchanges. A proprietary quantitative system compares each company to its peers on proven measures of business value, growth characteristics, and investor behavior. Ford's three recommendation ratings buy, hold and sell, represent each stock’s return potential relative to its own country market.. The rating reports which are generated each week, include the fundamental details behind each recommendation and reflect the fundamental and price data as of the last trading day of the week...

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