Riyadh – Mubasher: Arabian Internet and Communications Services Company (solutions) is projected to deliver a net income CAGR of c.10.9% during the period from 2025 until 2030, according to an investment update by Aljazira Capital.
“We maintain our positive rating with a blended TP of SAR 254/share, as we believe current valuations do not fully reflect the company’s medium-term growth potential from Saudi Arabia’s accelerating digital infrastructure and enterprise digitalization spending cycle,” Aljazira Capital stated.
It added that the expected dividend yield of 4.1% further enhances the total expected return profile to 16.6%.
Aljazira Capital maintains ‘Overweight’ recommendation, as structural pricing pressure weighs on margins; however, growth visibility is endorsed on large contract wins and inorganic opportunities ahead.
After a broader slowdown in Saudi Arabia’s ICT services sector and continued pricing pressure in public sector tenders after the implementation of the Etimad platform, solutions continues to face near-term margin pressure amid intensifying competition and slower project execution cycles.
Aljazira Capital added that solutions’ medium-term growth outlook remains supported by a healthy SAR 14 billion backlog, improving project conversion, recent large-scale contract wins from Saudi Aramco at a value of SAR 1.4 billion, National Water Company (NWC) at SAR 520 million in value, and Saudi Telecom Copmany (stc) at an amount worth SAR 132 million. This is in addition to growing contribution from subsidiaries including Giza Systems, LABS and CCC.
Furthermore, contained operating expenses (-7% year-on-year (YoY) in 2026) improving free cash flow generation, and a net cash worth SAR 1.6 billion of balance sheet provide sufficient financial flexibility to pursue further inorganic expansion in higher-value digital services including cloud, AI infrastructure, cybersecurity, and digital consulting.
In the first quarter (Q1) of 2026, solutions recorded net profit worth SAR 370 million. Meanwhile, the company recently obtained a regulatory nod to increase its capital through bonus shares.
