ORDS: Expanding API Ecosystem And Cross-Border Solutions Will Drive Long-Term Value

Key Takeaways

• Major investments in digital infrastructure, fintech, and 5G are driving new revenue streams, market expansion, and improved margins beyond core telecom operations.
  
• Operational efficiency, digitalization, and disciplined capital allocation are supporting ongoing margin expansion and sustained profitability.
  
• Sustained competitive pressures, high capital needs, and slow digital monetization threaten profitability, cash flow, and Ooredoo's ability to diversify amid mounting regulatory and economic risks.

Catalysts

Provides telecommunications services in Qatar, rest of the Middle East, Asia, and North Africa region.

• Ooredoo's expansion in digital infrastructure-such as launching sovereign AI cloud services with NVIDIA, scaling data center capacity (Syntys), and building the largest subsea cable in the GCC-positions the company to benefit from increasing demand for data and connectivity, directly supporting long-term revenue growth and higher margins.
  
• Diversification into fintech and digital financial services across existing and new markets leverages Ooredoo's 50 million+ customer base and rising financial inclusion trends, providing untapped growth potential and new high-margin revenue streams beyond core telecom.
  
• The ongoing proliferation of smartphones, digital consumption, and urbanization across Ooredoo's fast-growing MENA and Asian markets are driving higher data ARPU and steady customer base growth, which are expected to translate into sustained topline and EBITDA expansion.
  
• Strategic investments in network modernization-including 5G rollouts (secured licenses in Algeria, launches in Tunisia and upcoming in Iraq)-enable future service differentiation, premium data monetization, and improved competitive positioning, supporting medium
• to long-term revenue and margin enhancement.
  
• Continued focus on operational efficiency, digital migration, and disciplined capital allocation has led to higher group-wide EBITDA margins (now mid-40s versus high-30s a few years ago), and further improvements in cost structure and digital distribution are likely to support additional net margin expansion and stronger earnings.

Ooredoo Q.P.S.C Future Earnings and Revenue Growth

Assumptions

• Analysts are assuming Ooredoo Q.P.S.C's revenue will grow by 1.9% annually over the next 3 years.
• Analysts assume that profit margins will increase from 14.7% today to 15.9% in 3 years time.
• Analysts expect earnings to reach QAR 4.0 billion (and earnings per share of QAR 1.25) by about September 2028, up from QAR 3.5 billion today. However, there is some disagreement amongst the analysts with the more bullish ones expecting earnings as high as QAR4.4 billion.
• In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 19.1x on those 2028 earnings, up from 11.7x today. This future PE is greater than the current PE for the QA Telecom industry at 11.7x.
• Analysts expect the number of shares outstanding to remain consistent over the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 18.85%, as per the Simply Wall St company report.

Ooredoo Q.P.S.C Future Earnings Per Share Growth

Risks

• Intensifying competition and commoditization in key markets, such as Oman and Indonesia, are eroding pricing power and driving price wars, which directly pressure revenue growth and profit margins in the long term.
  
• Persistent or increasing exposure to highly competitive or economically volatile markets (e.g., Oman, Palestine, and historical Myanmar exit) introduces earnings volatility and potential revenue decline, particularly as these market dynamics may worsen over time.
  
• Ongoing high capital expenditure needs for 5G rollouts, data center expansions, and subsea cable projects are straining free cash flow (which fell 11% YoY in H1 2025), potentially squeezing net margins and limiting the ability to return capital to shareholders.
  
• Slow or limited progress in monetizing digital and fintech verticals-with fintech revenue and active user base still small relative to the total group-raises risk of inadequate diversification as core telecom ARPU faces secular decline from OTT competitors.
  
• Exposure to regulatory and geo-political risks-such as difficulty upstreaming cash from Maldives, new global tax regulations (Pillar 2), and emerging market instability-could negatively impact net income, cash availability, and future earnings power.

Valuation

• The analysts have a consensus price target of QAR14.233 for Ooredoo Q.P.S.C based on their expectations of its future earnings growth, profit margins and other risk factors.
• In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be QAR25.3 billion, earnings will come to QAR4.0 billion, and it would be trading on a PE ratio of 19.1x, assuming you use a discount rate of 18.9%.
• Given the current share price of QAR12.88, the analyst price target of QAR14.23 is 9.5% higher.
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.