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INSURANCESanad InsuranceAlso known asSANADPriceSR34.4Pricing / Valuation as on May 27, 2009Mkt capSR0.7bn ($183.7mn)Sh. outstanding20.0mnKey statistics52 week range H/L (SR) 58.5/9.8Avg daily turnover (mn) SR US$3m 46.61 12.4512m 22.20 5.93Raw Beta 6m 2yr1.09 0.97Reuters8090.SEBloombergSANAD ABPrice perform (%) 1M 3M 12MAbsolute (%) (38) 103 1Market (%) 6 32 (39)Sector (%) (2) 48 (26)Website: www sanad.com.saValuation multiples2006 2007 2008P/E (x) NA NM NMP/B (x) NA 6.2 1.4P/Sales (x) NA NA 86.4Div yield (%) NA NA 0.0Sanad Insurance & Reinsurance Cooperative Company (SANAD) was established in2006. The company provides a diverse range of car, general, health, property andmarine insurance and reinsurance services. It also has plans to expand productportfolio to cover insurance for agriculture, airlines, ships, petrol and power.Company financials2007 2008YoY(%)CAGR(%)(05-08)Net Insurance Premium SRmn NA 3 - -Total Revenues SRmn NA 3 - -Net Income SRmn (9) (16) - -Assets SRmn 191 221 15.6 -Equity SRmn 191 175 (8.4) -Investments SRmn 186 173 - -Technical Reserves SRmn NA 22 - -Combined Ratio % NA 343.9 - -Net Mgn % NA NM - -ROE % (4.7) (8.9) - -ROA % (4.7) (7.9) - -Div Payout % NA 0.0 - -EPS SR (0.5) (0.8) - -Book Value Per Share SR 9.5 8.7 (8.4) -Source: Company, NCBC ResearchSegment-wise business analysisProduct segment 2008 Geographic 2008%Rev % Net Inc Breakup %Rev % Net IncWeightage (%)TASI (free float weight) 0.06MSCI Saudi (domestic – small cap) 0.61Free float (%)Free float 40.0Relative share price perf.11,000609,000407,0005,000203,000-M ay-08 Aug-08 Nov-08 Feb-09 M ay-09TASISANAD (RHS)Top 5 shareholders (%)Al Khazna Insurance Co. 15.0Saudi Continental Insurance Co. 10.0Ramat Marketing and Distribution Co. 5.0Source: NCBC ResearchSource: Company, NCBC Research• Business brief: SANAD provides fire, travel, medical, motor, property, marine andengineering insurance products. The company also offers insurance against generalaccidents. In addition, SANAD offers life insurance products and reinsuranceservices.• Financials: The company recorded revenues of SR2.8mn in 2008. However, sinceSANAD is a recently established company, it continued to incur high operatingexpenses, which led to a net loss of SR16.2mn in 2008 as compared to SR9.0 mn in2007. SANAD’s total asset base as on 2008 was SR221.1mn while the shareholder’sequity stood at SR175.0mn.• Recent developments: SANAD reported its 1Q-09 results on April 20, 2009. Thecompany’s net loss surged to SR4.8mn in 1Q-09 compared to a net loss of SR0.9mnin 1Q-08. In May 2008, Al Khazna Insurance Co. acquired a 15.0% stake in SANAD,through buying 3mn shares for SR96.8mn. In the same month, the companyappointed Mr. Ahmad Bin Abdullah Al Akili as the new chairperson to replace Mr.Abdullah Bin Yahia Al Muallimi. In addition, Mr. Azman Daya was appointed as thenew CEO.JUNE 2009SANAD INSURANCE194