Aljazira Cap maintains “Neutral” recommendation for Mobily, raises TP to SAR 27.5/share

Etihad Etisalat Co.’s (Mobily) second quarter (Q2) 2020 net profit of SAR 185 million came above analyst and consensus estimates of SAR 105 million and SAR 148 million respectively, Aljazira Capital said in a research note.

The brokerage firm expects similar revenue growth trend in H2 2020, despite the negative impact of the suspension of Umrah and restriction of Hajj to limited pilgrims.

Additionally, the momentum in wholesale revenue and the increase in Fiber to the Home (FTTH) subscribers are likely to boost the company’s top line.

Mobily’s finance cost reduced significantly during the second quarter and is likely to stay at the same level for the rest of 2020, given low interest rates and the refinancing of a major part of the company’s debt.

Aljazira Capital maintained its “Neutral” recommendation and raised the target price to SAR 27.5 per share.