Riyad Cap maintains ‘Buy’ recommendation for Jarir, raises TP to SAR 197

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Riyad Capital maintained its ‘Buy’ recommendation for Jarir Marketing Co. and raised the share target price (TP) to SAR 197 from SAR 195.

The brokerage firm said in a research note that Jarir has an opportunity to secure a major stake in the e-commerce space as the company works to improve its website and its brand in light of the high demand for e-commerce platforms in the GCC in general.

Despite COVID-19 in 2020, Jarir managed to reach a net income of SAR 1 billion mainly through an increase in sales through the website, by working to deliver orders from the nearest store within hours.

The company is also looking at opening a new platform in websites such as Alibaba and Amazon to increase its customer base and penetrate a new market.

Riyad Capital believes that there are still tremendous growth opportunities in the Middle East and North Africa (MENA) region in e-commerce, expecting the number of Jarir's branches to increase to 85 by 2025.

It expects Jarir to achieve a net profit of SAR 1.07 billion in 2021, SAR 1.14 billion in 2022, and SAR 1.23 billion in 2023.