NCB Capital initiates BinDawood with 'Neutral' rating, TP set at SAR 118.6/share

NCB Capital initiated coverage on grocery retailer BinDawood Holding, with a “Neutral” recommendation, setting the stock's target price at SAR 118.6.
 

The stock's key strengths are the high profitability, strong supplier relations, measured expansion approach and strong management team, the brokerage said.
 

It added that the group is the most profitable grocery retailer in the Saudi market, driven by a wide and deep product range, higher contribution of fresh and imported products, being number one retailer serving pilgrims, a superior shopping experience, and efficient supply chain.
 

"BinDawood operates in a fast-growing sector which is expected to benefit from consolidation and high disposable income," NCB Capital said.
 

It added that the company plans to expand its store network to a minimum of 100 stores by 2024, from 73 as of September 2020.  
 

The retailer is expected to post a net profit rise of 23% to SAR 515 million this year, ahead of growing to SAR 554 million in 2021.