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BUILDING & CONSTRUCTIONAl-Babtain PowerAlso known asAl BabtainPricePricing / Valuation as on May 27, 2009Mkt capSh. outstandingKey statisticsSR41.4SR1.7bn ($447.7mn)40.5mn52 week range H/L (SR) 85.5/33.7Avg daily turnover (mn) SR US$3m 42.36 11.3112m 26.68 7.12Raw Beta 6m 2yr0.73 1.02ReutersBloomberg2320.SEALBABTAI ABPrice perform (%) 1M 3M 12MAbsolute (%) 5 (10) (41)Market (%) 6 32 (39)Sector (%) 8 19 (53)Website: www.al-babtain com saValuation multiples2006 2007 2008P/E (x) 20.4 22.8 13.4P/B (x) 4.3 5.2 3.5P/Sales (x) 2.3 2.6 1.7Div yield (%) 1.9 2.5 1.6Weightage (%)TASI (free float weight) 0.38MSCI Saudi (domestic – small cap) 1.09Free float (%)Free float 99.97Relative share price perf.11,0009,0007,0005,0003,000M ay-08 Aug-08 Nov-08 Feb-09 M ay-09TASITop 5 shareholders (%)10080604020-AL Babtain (RHS)Al-Babtain Power & Telecommunication Company (Al-Babtain) provides outdoorlighting, transmission & distribution (T&D), and testing station services to thepower sector. In addition, it designs, manufactures, and installs steel towers for thetelecommunications sector. Al-Babtain was established in 1955 in Riyadh.Company financials2005 2006 2007 2008YoY(%)CAGR(%)(05-08)Net Revenues SRmn 543 672 836 1,013 21.2 23.1EBITDA SRmn 88 119 149 210 41.0 33.7Net Income SRmn 66 76 96 131 36.3 25.8Assets SRmn 717 850 991 1,416 43.0 25.5Equity SRmn 314 359 423 499 17.8 16.7Tot Debt SRmn 256 221 328 602 83.4 33.0Cash & Equiv SRmn 19 17 20 68 238.1 53.7EBITDA Mgn % 16.2 17.7 17.9 20.8 - -Net Mgn % 12.1 11.2 11.5 12.9 - -ROE % 21.9 22.5 24.6 28.1 - -ROA % 10.3 9.6 10.4 10.8 - -Div Payout % - 39.3 56.2 20.9 - -EPS SR 2.4 2.8 3.6 4.8 33.3 26.0BVPS SR 11.6 13.3 15.7 18.4 17.2 16.6Source: Company, NCBC ResearchSegment-wise business analysisProduct segment 2008 Geographic 2008%Rev % Net Inc Breakup %Rev % Net IncLighting & Poles 45.4Towers and Steel Structures 24.2Design, Supply & Installation 30.4Source: Company, NCBC Research• Business brief: Al-Babtain’s T&D portfolio comprises transmission towers up to 500kV, monopoles up to 230 kV, and distribution poles up to 33 kV. The company’ssubsidiary Al-Babtain LeBLANC Telecommunication (51% stake) is a joint venturewith LeBLANC provides turnkey solutions for implementing structural steel towers toutilities and the oil & gas, telecom, and broadcasting sectors. The steel galvanizingplant—one of the largest in the region—provides hot dip galvanizing services to makesteel products corrosion-resistant and protect them from early damage. Al-Babtain’smanufacturing facilities are located in Riyadh and Cairo• Financials: Al-Babtain’s top-line grew 21.2% y-o-y to SR1012.7mn in 2008. Animpressive expansion in EBITDA margin helped net margin to grow to 12.9% in 2008.Cash and cash equivalents rose substantially mainly due to the presence of cashcollateral worth SR50.0 mn.• Recent developments: The company announced its 1Q-09 results on April 21, 2009.Net profit slumped 25.1% y-o-y to SR31.1mn in 1Q-09. On April 1, 2009, thecompany issued 1:2 bonus shares. In March 2009, the company appointed eight newSource: NCBC Researchmembers to its board of directors. In June 2008, Al-Babtain signed a contract worthSR242.7 mn with National Contracting Co. Ltd. to supply galvanized powertowers with a capacity of 380 kilovolts.JUNE 2009AL-BABTAIN POWER228