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PriceSR41.0Pricing / Valuation as on May 27, 2009Mkt capSR3.3bn ($889.5mn)Sh. outstanding81.3mnKey statistics52 week range H/L (SR) 80.0/35.5Avg daily turnover (mn) SR US$3m 36.30 9.6912m 39.68 10.59Raw Beta 6m 2yr0.44 0.59Reuters2340.SEBloombergALABDUL ABPrice perform (%) 1M 3M 12MAbsolute (%) 2 (0) (20)Market (%) 6 32 (39)Sector (%) 11 29 (33)Website: www carpets.comValuation multiples2006 2007 2008P/E (x) NA 22.3 18.0P/B (x) NA 4.0 3.0P/Sales (x) NA 4.2 3.2Div yield (%) NA 2.2 0.0INDUSTRIAL INVESTMENTAl Abdullatif Indl.Also known asAIICAl-Abdullatif Industrial Investment Company (Al Abdullatif), established in 1981,ranks among the largest carpet manufacturers in the world. The company’s fullyintegrated operations—from fiber extrusion to finishing—gives it a comparativeadvantage in the timely and cost-effective execution of orders.Company financials2005 2006 2007 2008YoY(%)CAGR(%)(05-08)Net Revenues SRmn 748 861 1,066 1,139 6.8 15.1EBITDA SRmn 237 265 288 282 (2.1) 6.1Net Income SRmn 173 192 200 201 0.6 5.1Assets SRmn 1,087 1,172 1,312 1,534 17.0 12.2Equity SRmn 719 911 1,111 1,215 9.3 19.1Total Debt SRmn 257 152 63 218 245.2 (5.5)Cash & Equiv SRmn 149 116 75 35 (53.7) (38.3)EBITDA Mgn % 31.6 30.8 27.0 24.8 - -Net Mgn % 23.2 22.3 18.8 17.7 - -ROE % 21.1 23.5 19.8 17.3 - -ROA % 16.2 17.0 16.1 14.1 - -Div Payout % 48.7 0.0 - -EPS SR 3.1 3.0 3.1 2.5 (19.5) (7.7)BVPS SR 13.1 14.0 17.1 15.0 (12.5) 4.6Source: Company, NCBC ResearchSegment-wise business analysisProduct segment 2008 Geographic 2008%Rev % Net Inc Breakup %Rev % Net IncWeightage (%)TASI (free float weight) 0.24MSCI Saudi (domestic – small cap) 1.61Free float (%)Free float 32.00Relative share price perf.11,000009,00080607,000405,000203,000-M ay-08 Aug-08 Nov-08 Feb-09 M ay-09TASIAlAbdullatif (RHS)Top 5 shareholders (%)Al Abdul Latif Holding Group 60.0Amr Sulaiman Saleh Al Abdul Latif 5.8Source: NCBC ResearchSource: Company, NCBC Research• Product profile: Al Abdullatif’s manufactures three kinds of carpets — tufted, woven,and non-woven; primarily made from synthetic fibers. The company exports thesecarpets to more than 25 countries. The color pigment division provides variousshades of color for the production of carpets and blankets. The paper tube divisionprovides paper tubes of different sizes and thicknesses for the winding of carpets andyarn. The company’s five fully owned affiliates provide backward integration supportto the company.• Financials: In 2008, Al Abdullatif’s sales grew 6.8% year-on-year (y-o-y) toSR1,138.9mn. However, net income remained nearly flat at SR201.3mn in 2008 ascompared to SR200.1mn in 2007. This was largely due to higher cost of sales andadministrative expenses in 2008. There was also a significant decline in cash balanceas the company invested heavily in fixed assets.• Recent developments: Al Abdullatif’s net profit for the 1Q-09 decreased 49.53% y-oyto SR 26.01mn. In September 2008, Al Abdullatif announced the acquisition of 27%stake in Red Sea Cables Co.; which is under establishment and has a capital ofSR370mn. In March 2008, the company increased its capital to SR812.5mn throughissuance of bonus shares.JUNE 2009ALABDULLATIF INDUSTRIAL217