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BUILDING AND CONTRUCTIONThe pricing multiples of the companies in this sector indicate a mixed trend. Some of thecompanies experienced relatively flat multiples, while for others it increased significantly in2005–06. This was due to exceptional growth in the Saudi stock market, supported by agrowing economy, several IPOs, and a fast developing capital market. However, the pricingmultiples are currently at attractive levels, primarily due to the correction in the Saudi stockmarket. As of 2007, P/E was at 30.6x, while P/BV was at 4.7x. As depicted in Exhibit 55 and 56,pricing multiples have been on the decline in 2008, providing an attractive long-term investmentopportunity. Mohamed Al Mojil recorded the highest RoE in 2008, while P/BV was the highestfor Saudi Ceramics.Exhibit 133: Comparison of P/B and RoE, 2007 Exhibit 134: Comparison of P/B and RoE, 2008ROE(%)55453525155-5RedseaArabian pipesSIDCSaudi CableCo.SpecializedCablesAl babatainGypsumZamil SaudiCeramicsAmiantitSaudi VitrifiedP/B0 2 4 6 8 10ROE(%)50403020100-10Saudi CableCo.AmiantitGypsumArabian pipesMohamed AlMojilSaudiVitrifiedZamilRedseaAl babatainSaudiCeramicsSpecializedCables0 1 2 3 4SIDCP/BSource: Bloomberg, Reuters, NCBC ResearchSize of the bubble represents market cap. as on 31 Dec 2007Source: Bloomberg, Reuters, NCBC ResearchSize of the bubble represents market cap. as on 31 Dec 2008Exhibit 135 shows the average daily trading volume of the 12 companies. Currently, SaudiIndustrial Development Co has the highest average daily trading volume.Exhibit 135: Average daily trading volume of stocks (‘000s) , Jan 2007 – Dec 20083,0002,5002,5622,4612,0001,8161,5001,0001,0626967771,4797801,0937825004152410SCERCOSAACZIICMESCNGCOSVCPSCACOAPCOALBABTAIREDSEASIDCMMGSource: Reuters, TadawulJUNE 2009SAUDI ARABIA FACTBOOK85