Update shared on 20 Dec 2025
Fair value Decreased 0.29%Analysts have trimmed their price target for Saudi Basic Industries slightly, reducing fair value by about $0.19 to $63.49. This reflects expectations of stronger top line growth, offset by a modestly lower profit margin and a higher implied future earnings multiple.
What's in the News
- Twareat Medical Company has filed a legal claim against Saudi Basic Industries, seeking SAR 34.5 million including VAT, alleging SABIC failed to meet the minimum number of contractually agreed medical test requests between 2019 and 2024 (Key Developments).
- The claim relates to a five year occupational health services contract under which Twareat operates eight medical clinics within SABIC facilities, providing staff, equipment, medications, diagnostics, and laboratory tests for SABIC employees and subsidiaries (Key Developments).
- Twareat states the financial impact of the case cannot yet be determined. However, a successful outcome and recovery of the full claimed amount would have a positive effect on its financial results at the time of collection (Key Developments).
- An external counsel notice dated November 26, 2025 indicates that, after closure of pleadings and deliberation, a judicial panel ruled that the commercial courts lack subject matter jurisdiction to hear the compensation claim against SABIC (Key Developments).
- SABIC has scheduled a special or extraordinary shareholders meeting in Riyadh on December 31, 2025 at 19:00 Arab Standard Time, with details yet to be fully disclosed to investors (Key Developments).
Valuation Changes
- Fair Value: Trimmed slightly from SAR 63.67 to SAR 63.49, a reduction of about SAR 0.19 per share.
- Discount Rate: Risen marginally from 20.02 percent to 20.05 percent, indicating a slightly higher required return on equity.
- Revenue Growth: Increased significantly from around 1.58 percent to 3.62 percent, reflecting stronger top line growth assumptions.
- Net Profit Margin: Reduced from about 7.38 percent to 6.51 percent, incorporating expectations of softer profitability.
- Future P/E: Increased from roughly 30.65x to 32.69x, implying a higher valuation multiple applied to forward earnings.
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