Diversified operations with growth potential

Aamal’s highly diversified operations and market-leading position in key growth sectors provide resilience across its 32 business units. Due to its integrated nature within the country, it provides investors with exposure to the wider Qatari economy. The International Monetary Fund (IMF) forecasts real GDP growth in Qatar of 5.9% in 2026 and 7.6% in 2027, driven by government development plans focused on growing the country’s non-hydrocarbon sectors, as well as LNG capacity expansion. These could act as positive catalysts for Aamal. It is also well positioned to benefit from increased private and public sector demand. Aamal announced its intentions to establish a company in Saudi Arabia in early 2025, which is a significant indication of its continued growth strategy through regional expansion.

Strong balance sheet and diversified growth strategy

Aamal’s strong balance sheet (net debt/adjusted EBITDA of 0.45x at end FY23 and 0.43x at end FY24) provides headroom to fund additional growth capex in the near term. Combined with the government’s heightened focus on non-hydrocarbon sectors, this presents Aamal with opportunities for greater growth over the medium term. We introduce estimates, forecasting revenue growth of 8% in both FY25e and FY26e, with EBIT margins of 20% in both years. An online interactive version of our model, powered by Stellar Fusion, can be found here.

Valuation: Low multiples despite growth prospects

Aamal trades at a 26% discount relative to peers in the MENA region, based on FY25e EV/EBITDA multiples (12.3x vs a 16.5x weighted average). Based on our estimates, the company is trading at 15.0x FY25e P/E (a 27% discount to peers). We value Aamal on a 50:50 blend of a discounted cash flow (DCF) valuation (QAR1.17/share) and an EV/EBITDA multiple valuation (QAR1.26/share), implying a valuation of QAR1.22/share, c 40% upside to the current share price.

Highly diversified Qatari business

Aamal Company is based in Qatar and listed on the Qatar Stock Exchange (QSE), and is one of the largest and most diversified Qatari companies. It operates across four key sectors: Trading and Distribution, Industrial Manufacturing, Property and Managed Services, with 32 business units. Aamal’s diversified business sectors provide resilience across global and regional economic cycles. The company is exposed to Qatar’s non-hydrocarbon growth story, with government development plans such as the Third National Development Strategy (NDS3) and Qatar National Vision 2030 looking to reduce the country’s dependence on LNG exports, creating greater economic resilience. The government’s LNG expansion projects are expected to be completed by end 2030 and should feed through to additional spending for Qatar’s non-hydrocarbon sectors, which could directly benefit Aamal. Holding company Al Faisal is Aamal’s main shareholder and one of Qatar’s leading private companies, having played a significant role in the development of the Qatari economy and infrastructure. Its chairman, Sheikh Faisal bin Qassim Al Thani, also chairs the board of Aamal Company.

The company offers exposure to Qatar’s growth and development, driven by the government’s Qatar National Vision 2030. This initiative has the potential to propel Qatar’s economic growth. The IMF forecasts real GDP growth in Qatar of 5.9% in 2026 and 7.6% in 2027, supported by the LNG capacity expansion projects of Qatar’s North Field deposit. The first project phase is expected to be completed in 2028 and the second smaller phase by 2030. This should see additional capital flow into non-oil sectors, creating gradual growth.

Aamal focuses on sectors essential for Qatar’s economic growth, including industrial manufacturing, real estate and healthcare, as well as other high-growth sectors such as energy and information technology (within healthcare). The company has established strong, market-leading positions in Qatar, continually seeking to enhance its operational performance through further diversification, innovation and its product and service offerings.

The company is well positioned to benefit from increasing private and public sector demand, particularly in healthcare. The Qatari government has allocated a substantial budget of QAR41.4bn for healthcare and education in 2025 alone, further enhancing Aamal’s growth prospects in this sector. Aamal continues to pursue growth opportunities, having made three acquisitions in FY24, as well as announcing, in early 2025, its intention to establish an industrial manufacturing company in Saudi Arabia, demonstrating its diversified growth strategy, including regional expansion.

Aamal does not have any direct listed peers operating within its markets as a result of its dominant position in diversified businesses and Qatar-based operations.

Valuation

Aamal trades at a 26% discount to a mixture of relative peers in the MENA region, based on FY25e EV/EBITDA multiples (12.3x vs a 16.5x weighted average for peers based on Aamal’s FY24 revenue segment breakdown) and 15.0x FY25e P/E on our estimates, a 27% discount to peers. We value Aamal on a 50:50 blend of a DCF valuation (QAR1.17/share) and an EV/EBITDA multiple valuation (of QAR1.26/share), implying a valuation of QAR1.22/share, c 40% upside to the current share price.

Financials

Aamal has grown its revenues at a CAGR of 8.4% in the six years from FY18 to FY24. Excluding FY20 when the company’s property segment margin decreased drastically due to management’s decision to waive rents for tenants during the COVID-19 pandemic, the EBIT margin has averaged c 20% since FY18, declining slightly in FY21–23 to 15–18%. At the end of FY24, Aamal’s EBIT margin was at the upper end of this range (18%).

Aamal benefits from a strong balance sheet, with net debt of QAR216m at the end of FY24 (net debt/adjusted EBITDA of 0.43x at end FY24), combined with low levels of gearing (2.52% at end FY24). It is well capitalised, with a shareholders' equity ratio of 89% in FY24. Organic and inorganic growth initiatives are underpinned by strong internal cash flows (QAR229m net cash flow from operating activities and an operating cash flow to net income ratio of 1.02x at end FY24) and the availability of debt financing opportunities. The company also benefits from the supportive backing of its long-term majority shareholder, Al Faisal Holding. Aamal has a strong track record of being one of the highest dividend payers among QSE-listed companies, paying a dividend of QAR0.05 per share in FY23, which equated to 5% or QAR315m of profit in FY22. However, in FY24, shareholders approved a zero dividend at the AGM held in March 2024 and Aamal’s board of directors proposed a cash dividend of 6% of share capital for FY25, amounting to QAR378m (QAR0.06/share, a 20% increase y-o-y), representing a dividend yield of 7% on the current share price for FY25, which will be submitted for formal approval at the AGM this year.

We introduce estimates, forecasting revenue growth of 8% in both FY25 and FY26, EBIT of QAR447m and QAR479m, respectively, and EBIT margins of 20% in both years. Importantly, Aamal’s strong balance sheet, net debt/adjusted EBITDA of 0.45x at end FY23 and 0.43x at end FY24, provides it with options to fund additional growth capex in the next three years.

Risks and sensitivities

Aamal’s diversified business model offers exposure to national growth initiatives, balanced with significant risk factors including volatile LNG market dynamics, capital-intensive operational requirements and regional geopolitical dynamics. Despite potential headwinds from LNG market competition, fluctuating crude prices and ESG pressures, Aamal’s deep integration with Qatar’s economic diversification agenda positions it to potentially capitalise on opportunities in emerging non-hydrocarbon sectors. Its strategic resilience hinges on its ability to manage execution risks and adapt to the evolving economic and geopolitical landscape. According to the QSE, Aamal has no foreign ownership limit and no maximum shareholder ownership. It has a reasonably low free float of c 30%, as well as a relatively low trading volume, with the average number of shares traded daily across the last year at c 1.4m (c US$330k).

A highly diversified industrial conglomerate

Aamal Company is one of the largest and most diversified companies in Qatar, operating across four key business segments: Industrial Manufacturing, Trading and Distribution, Managed Services and Property. Within these segments, it has 32 business units with market-leading positions in key growth areas in Qatar. The depth and diversity of Aamal’s portfolio of companies has enabled it to show great resilience in economic and industry cycles, while demonstrating continued strong growth. Aamal is controlled through its two majority shareholders, Al Faisal Holding and Sheikh Faisal bin Qassim Al Thani.

The company listed on the QSE in 2007, having been established in 2001, with underlying operations dating back to 1964. Aamal has been an integral part of Qatar’s economic growth story (apart from its oil and gas resources) and is well positioned to play a vital role in the future growth of the economy, backed by the Qatar National Vision 2030 initiative.

Creating long-term shareholder value

Aamal’s business strategy is to create long-term shareholder value through the continued profitable operation and expansion of its diversified business platform. The company seeks to take advantage of the growth opportunities provided by the Qatar National Vision 2030 initiative, while leveraging its position as a leading participant across various key sectors in Qatar, focusing on what management views as three pillars for sustainable, profitable growth:

1. Sector focus: having a key focus on high-growth sectors in Qatar (industrial manufacturing, real estate, healthcare), enabling the company to capitalise on the expected increase in demand arising from the wider industrialisation of the Qatari economy.
2. Diversification and innovation: building on historically strong and established market positions, aiming to enhance performance through continued diversification, innovation and high-quality products and services.
3. Operational and financial discipline: maintaining strict financial and operational discipline while continuing to actively pursue the company’s pipeline of strategic growth initiatives.

Qatari economic growth and company outlook

Given that Aamal is such an integral part of the Qatari economy, forecast real GDP growth is a good indication of the potential opportunities for the company in the near term. Qatar has become one of the world’s fastest-growing and most successful economies. It is worth noting that the Qatari riyal is pegged to the US dollar at a rate of QAR3.64/US$ and is allowed to fluctuate in a range of 3.6385–3.6415.

The IMF forecasts real GDP growth in Qatar of 1.5% in 2024 and 1.9% in 2025, which is behind the world average. However, in 2026, 2027 and 2028, the IMF forecasts real GDP growth of 5.9%, 7.6% and 3.4%, respectively. The forecast growth for these years is among the highest globally and significantly above other regions (see Exhibit 6). Qatar’s expected significant increase in real GDP growth between 2026 and 2028 is due to the LNG capacity expansion project of its North Field deposit, which is expected to start in 2026 and run to 2030. It is anticipated that the project will provide additional capital, which the Qatari government would feed back into the economy to grow and diversify its non-oil sectors. It is also worth noting that on 1 November 2024, S&P Global Ratings affirmed its AA/A-1+ long- and short-term foreign and local currency sovereign credit rating for Qatar.

Qatar’s framework for economic development

During 2023, Qatar’s economy returned to a more stable growth trajectory after the FIFA World Cup boom in 2022, with a promising medium-term outlook driven by the expansion of the North Field (East) (US$30bn) and the North Field (South) (US$20bn) LNG projects, both pivotal driving forces in the local manufacturing sector. The initial phase of the expansion project is expected to be completed by 2028, and the second smaller phase by 2030. The total expansion is expected to increase Qatar’s LNG capacity by 85% before 2030, from 77Mtpa to 142Mtpa. This increase in capacity is significant for Qatar, considering the North Field deposit is one of the largest gas deposits in the world. Additional capital from the increase in capacity is expected to be fed back into the Qatari economy, not only to its industrial sector (through industrial materials and construction of the projects), but also as additional spending capacity for the government to support its non-hydrocarbon growth initiatives.

Qatar’s non-hydrocarbon sectors continue to drive diversification efforts in the country, boosted by the implementation of the NDS3, which outlines seven strategic national goals to guide the country’s development over the same number of years. This comprehensive plan aims to transform Qatar into a sustainable, diversified and globally competitive economy, while maintaining its cultural values and environmental responsibility. The seven goals are:

• Sustainable economic growth.
• Fiscal sustainability.
• Future-ready workforce.
• Cohesive society.
• Quality of life.
• Environmental sustainability.
• Government excellence.

Many of Aamal’s subsidiaries maintain market-leading positions in key economic growth sectors and government initiatives such as the NDS3 and Qatar National Vision 2030 should see the company benefit in the short and medium term.

The IMF forecasts modest economic growth in Qatar during 2024 and 2025, due to the expected stagnation in LNG output in these years. However, Qatar’s LNG output should be significantly enhanced with the North Field (East) and the North Field (South) LNG expansion projects, expected to be completed by 2026, which is reflected in the IMF’s real GDP forecast from 2026 onwards. This capacity expansion is expected to re-establish Qatar as the world’s leading LNG producer.

Qatar’s technology, healthcare, aerospace and energy transition sectors will bolster growth in the coming years through significant investment from the Qatar Investment Authority, the world’s eighth-largest sovereign fund. With a greater focus on its non-hydrocarbon sectors, this strategic transformation in Qatar highlights the country’s commitment to economic resilience, innovation and growth. Low global LNG prices, coupled with the market volatility seen in recent years, has resulted in Qatar recording an oil and gas revenue decline of 15% y-o-y in H124, highlighting the country’s need to strengthen its wider economy, especially in non-hydrocarbons.

High-frequency data in Qatar showed strong signs of a positive start to 2024 in its non-hydrocarbon activities, with the Purchasing Managers’ Index reaching 55.9 in June 2024, the highest since July 2022, underpinned by a thriving tourism sector.

Qatar’s economic trajectory since 2020 presents a clear narrative of recovery and strategic growth. The nation experienced a contraction in 2020, with non-oil GDP declining by 4.4%, according to World Bank data, primarily due to the impact of the COVID-19 pandemic on global markets. The subsequent years marked a strong rebound, with non-oil GDP growth reaching 2.8% in 2021 and accelerating to 5.6% in 2022, driven by FIFA World Cup-related infrastructure development and tourism sector expansion.

The most notable inflection point in Qatar’s growth outlook lies in its hydrocarbon sector from 2026. Substantial capital investment in Qatar’s LNG facilities during 2024–25 is expected to result in significant production capacity expansion by 2026. IMF projections reflect this transformation, with real GDP growth forecast to surge from 2% in 2025 to 5.8% in 2026, accelerating to 7.6% in 2027 (while the World Bank forecasts oil GDP growth of 7.8% in 2026 alone, Exhibit 7). For reference, according to Moody’s, in 2023 when oil was US$83/bbl, hydrocarbons accounted for 30% of Qatar’s GDP, while between 2011 and 2014 when oil averaged c US$110/bbl, hydrocarbons contributed 55%. This trajectory underscores Qatar’s strategic positioning in global energy markets and its commitment to expanding its LNG infrastructure. Qatar’s constant forecast growth in non-oil markets reflects its efforts to diversify its economy away from sole reliance on LNG.

Leveraging Qatar’s economic environment for growth

Aamal continually looks to leverage Qatar’s economic growth, identifying new business opportunities to capture further upside, creating long-term value for its shareholders.

Industrial Manufacturing

The Industrial Manufacturing segment is a strategic pillar of Aamal’s operations, positioning the company to capitalise on government initiatives to support private sector growth. The 2024 and 2025 national budget included a significant commitment to infrastructure development, with substantial allocations directed towards completing major projects across multiple verticals: educational facilities, healthcare infrastructure, transportation networks, residential developments and essential utilities (see Exhibits 9, 10 & 11). Aamal’s diversified Industrial Manufacturing portfolio is well positioned to directly benefit from this increased capital expenditure. Key demand drivers include the Phase B expansion of Hamad International Airport, planned extensions of the Doha Metro network, development of GCC Railway connectivity infrastructure and ongoing utility network expansions across the country. These large-scale projects are expected to generate sustained demand for building materials, steel structures, piping systems and power cables, and related electrical infrastructure. Additionally, the surge in infrastructure development should drive increased cargo shipping volumes, providing further revenue opportunities across Aamal’s logistics operations. The company’s established market position and comprehensive product portfolio uniquely position it to meet both near-term project requirements and long-term infrastructure maintenance demands.

The Industrial Manufacturing segment recorded revenues of QAR189.1m in FY24, down 52% from FY23. This decline was primarily attributed to the conclusion of the Aamal Cables contract (1,600MW Al Kharsaah Solar PV project). The FY22 revenue peak of QAR518m was due to the Doha Cables business significantly expanding its exports and signing several new contracts, including contracts to supply high-voltage cables to the North Field (East) LNG facility. Therefore, it is worth noting that there is potential for additional upside in the sector between 2026 and 2030, on the back of capacity expansion projects at the North Field deposit. Net profit margin in FY23 stood at -2.2%. In FY24, it improved to 1.9%, due to Senyar Industries benefiting from higher sales volumes generated by both Kahramaa and the North Field projects, improved demand for construction materials (Aamal Cement, Aamal Readymix and Ci-San) following the mobilisation of new construction projects, increased shipping rates and stable charter occupancy rates, according to management.

Acquisitions throughout FY24

In 2024 Aamal took further steps to reinforce its industrial manufacturing segment through multiple acquisitions:

• On 30 May 2024, it acquired the remaining 50% interest in Ci-San Trading, increasing its stake from 50% to 100%. The total considerations amounted to QAR32m paid in cash and settled on 16 July 2024. This acquisition will enable Aamal to further enhance its competitive market position across industrials, real estate and trading in both local and international markets.
• On 31 December 2024, it acquired an additional 20% interest in Frijns Structural Steel Middle East, increasing its ownership from 20% to 40%. The total consideration amounted to c QAR47.8m.
• On 1 December 2024, it acquired 50% of the shares and voting interests in Advanced Pipes and Casts, taking its total position from 50% to 100%. This acquisition will enable Aamal to increase its presence in the pipes and casts market through entering new joint venture relationships as strategic moves.

Post FY24 announcement: Intention to establish a new company in Saudi Arabia

On 13 January 2025, Aamal announced its intention to establish a new company based in Saudi Arabia offering integrated solutions in construction and infrastructure, which will be part of its wider industrial manufacturing business segment. The company will specialise in a broad range of activities across the sectors outlined above. These will include project design and participation in tenders, technical and engineering supervision and consulting services, production of precast concrete elements such as pillars and walls, manufacturing high-quality concrete pipes for water and wastewater networks, transportation and installation services for concrete components, quality control and inspections, comprehensive project management solutions, engineering solution development and custom-built construction components based on demand.

The new Saudi Arabian-based company will not only further diversify Aamal’s operations within its industrial segment, increasing its resilience against specific market downturns, but also diversify the company's revenue streams. This new venture is part of the company’s wider strategic plan to enhance its presence in new and promising markets. It will enable Aamal to further strengthen its regional expansion and open avenues for exploring new opportunities in vital sectors such as technology and energy, while underpinning Aamal’s industrial segment through sustainable growth.

Trading and Distribution

The healthcare sector is an increasingly strategic priority for Qatar, particularly within the framework of the NDS3. The Qatari government’s 2025 budget has allocated QAR41.4bn for healthcare and education, accounting for 20% of the total budget. The government’s allocation of 11% of the total national budget in 2023 to healthcare (similar to QAR21.1bn in 2022 and marginally up from QAR20bn in 2021) was a significant growth driver for Aamal’s Trading and Distribution segment, specifically benefiting Aamal Medical, Ebn Sina Medical and TIGA Information Technologies operations.
Several catalysts are poised to drive growth in the medical sector. The expansion of private healthcare facilities and the introduction of new multi-specialty hospitals are expected to generate sustained demand for advanced technology solutions, medical equipment and pharmaceutical products, all of which can be supplied through Aamal’s subsidiary companies.

Demographic tailwinds support the growth outlook, with Qatar’s population expected to expand by 3.32% each year from 2024 to 2029, following eight consecutive years of growth (source: Statista). This demographic expansion, coupled with strengthening vehicle demand (evidenced by a 13.7% y-o-y increase in vehicle sales during the first seven months of 2024), should also drive demand and growth in Aamal’s tyre and lubricants businesses. Qatar’s current population is 2.7 million (end-2023 according to the World Bank), with Qatari nationals making up c 10.5% of the population.

The Trading and Distribution segment’s revenue grew from QAR1,319m in FY23 to QAR1,484m at FY24, with a year-on-year growth rate of 12.5%, primarily driven by Ebn Sina Medical, which delivered strong revenue growth in FY24, in line with management targets. However, this was offset at the net profit level by the subdued performance of Aamal Medical due to delays of deliveries. The company also has two new warehouses under construction in Manateq to further support growth and improve operational efficiency at Ebn Sina Medical.

FY22’s significant expansion in revenue (33.5% y-o-y growth rate) was driven by increased public hospital demand ahead of the FIFA World Cup and new business launches. The strong performance in public hospitals was maintained in FY23, along with expansion into the private market. Ebn Sina Medical signed numerous new contracts and secured 34 drug application approvals in FY23, maintaining stable net profit margins of 10% across both financial years (FY22 and FY23).

Property

Management expects Aamal’s Property segment to experience steady growth, driven by Qatar’s population expansion and new business activities, particularly in tourism, sports and entertainment. Management states that the company’s property portfolio will continue to capitalise on the Qatari government’s continued commitment to host international events (eg 2025 MotoGP, Formula 1 as well as the FIFA Intercontinental Cup Finals, which it hosted in December 2024). City Center Doha (CCD), the company’s flagship retail asset (Exhibit 14), should continue to extract value from its prime location and recent enhancement initiatives. The mall’s competitive positioning appears strong given its strategic location. In the medium term, Aamal’s property portfolio is strategically aligned to benefit from Qatar’s commitment to hosting major international events. This government strategy provides a supportive macroeconomic backdrop for the company’s real estate assets and should drive sustained tenant demand across its portfolio.

The Property segment exhibited a relatively stable financial performance in FY24, with revenue increasing 3.1% y-o-y to QAR328.3m. However, net profit was affected by increases in costs associated with improvements and renovation that took place in FY24. This resulted in slight decreases in net profit and margins y-o-y of 2.4% and 4.2%, respectively (net profit: QAR244.0m, margin 74.3%). Aamal Real Estate saw minor declines in occupancy rates due to ongoing renovations, although management remains confident that the upgrades will improve the overall attractiveness of its portfolio. CCD performed strongly throughout FY24 with 30 new shops and kiosks opening in the year, cementing its position as a leading retail destination in Qatar. The Metro bridge also opened in FY24, which will further enhance foot traffic and increase accessibility to CCD.

The segment's significant FY22 growth of 14.7% stemmed from new store openings, normalised income at CCD and increased occupancy at Aamal Real Estate, while FY23’s revenue expansion was driven by regular rental uplifts and new leases following the completion of the renovation of CCD.

Managed Services

Aamal’s Managed Services segment is strategically positioned to capitalise from Qatar’s enhanced focus on development and tourism initiatives. The company is also positioned to benefit from the increase in demand for corporate cleaning, hospitality services and facility management through MMS and Aamal Services. Qatar’s growing mix of international events, including the Qatar MotoGP, Formula 1 and various educational conferences, creates substantial opportunities for ECCO Gulf’s (51% owned) IT services and business process outsourcing operations. Furthermore, the expansion of large-scale infrastructure projects across Qatar, particularly the ongoing maintenance requirements of key facilities such as Hamad International Airport, are expected to drive robust demand for facility management and cleaning services.

The Managed Services division has experienced significant volatility. In FY22, revenue surged c 74% y-o-y, driven by FIFA World Cup demand and the easing of COVID-19 restrictions, which propelled net profit up c 353% y-o-y. FY24 revenue increased 55.4% y-o-y to QAR162m, and net profit margin increased 0.4pp to 10.4%. This was primarily driven by contributions from Maintenance and Management Solutions (MMS), which saw new contracts signed in Q324 and existing contracts extended throughout 2024.

Aamal’s growth opportunities

Aamal posted strong growth in EPS for FY24 with an increase y-o-y of c 18%. Growth opportunities continue to arise via strategic initiatives to enhance the company’s core operations. Aamal remains committed to securing its growth through organic channels as well as via acquisitions of complementary business lines to further the company’s market reach as well as generate new revenue streams, creating additional diversification. Since the FY24 results, Aamal has confirmed the full acquisition of Advanced Pipes and Casts Company, through its fully owned subsidiary Aamal Readymix, taking its stake to 100% from 50%, as well as increasing its shares of Frijns to 40%.

Newly established subsidiaries Aamal Information Technology and Aamal Energy should enable the company to capture new opportunities. Aamal Energy will focus on oil and gas. Qatar’s largest export is LNG (60% of total exports), with crude oil its second largest export (30%). This will, therefore, allow Aamal to tap into a large pool of wealth, where significant infrastructure is already in place. Aamal Energy will also explore opportunities in clean energy, power generation, construction and supply as well as consultancy services.

Aamal will focus on expanding its presence in the healthcare sector by enhancing its IT healthcare solutions and securing additional distribution agreements, according to management. The company aims to capitalise on new opportunities arising from the complete acquisition of Ci-San Trading Company, which would bolster its capabilities and market reach, according to management. Ci-San focuses on investments in various sectors including industrial and marine transport services.

Management

Rashid Bin Ali Al-Mansoori (CEO): Mr Al-Mansoori was appointed CEO of Aamal Company in June 2022. He was previously the CEO of the QSE from 2011 to 2021. He serves as a board member and non-executive director of the Qatar Financial Centre and is on the board of the Qatar Finance and Business Academy. Mr Al-Mansoori also served as a member of the board of directors of the World Federation of Exchanges from 2017 to 2021 and, prior to joining the QSE, he held prominent executive leadership roles at the Qatar Investment Authority, Qatar Petroleum and the Ministry of Interior. Mr Al-Mansoori holds a BSc degree in computer and management sciences and an honorary master of professional accountancy from Metropolitan State University of Denver.

Sheikh Tamim bin Faisal Al Thani (deputy CEO): Mr Al Thani was appointed deputy CEO in September 2023 and holds a bachelor’s degree in economics and political science from Georgetown University in Qatar.

Sheikh Mohammed bin Faisal Al Thani (vice chairman and managing director): Mr Al Thani was appointed to the board of Aamal in 2009. He holds a bachelor’s degree in business administration from Carnegie Mellon University, Qatar, and is an honorary president of the Italian Chamber of Commerce in Qatar.

Mr Mohammad Al Ramahi (Group CFO): Mr Al Ramahi has worked in financial leadership roles for over 30 years and has been a member of the board of Al Faisal holding since 2018 and group CFO since 2019. Mr Al Ramahi holds a bachelor’s degree in business administration with a major in accounting from the University of Jordan and has worked and trained with both Ernst & Young and Arthur Andersen.

Shareholders

Aamal is held primarily by its top two shareholders, Al Faisal Holding (38.52%) and Sheikh Faisal bin Qassim Al Thani, who is the chairman of both Aamal Company and Al Faisal Holding.

Valuation

We value Aamal using a 50:50 blend of a DCF valuation (of QAR1.17/share) and an EV/EBITDA peer multiple valuation (QAR1.26/share), implying a valuation of QAR1.22/share, c 40% upside to the current share price of QAR0.88.

For our DCF valuation, we use a weighted average cost of capital (WACC) of 9% (risk-free rate of 4.2%, equity risk premium of 5.5% and a beta of 0.84, and 93% equity share of capital due to negligible levels of balance sheet leverage) and a 2.5% terminal growth rate. We model 10 years of earnings, and for a terminal value assume terminal capex (included in terminal cash flow) at similar levels to depreciation and earnings at through-cycle margins. Our DCF valuation yields a value of QAR1.17/share.

For our peer-based valuation, we apply a weighted average (on Aamal FY24 revenue) peer FY25e EV/EBITDA multiple (16.5x) to our FY25 estimates and an FY26 EV/EBITDA multiple (14.6x) to our FY26 estimates. Once adjusted for debt, this yields values of QAR1.30/share for FY25 and QAR1.23/share for FY26. We blend these on a 50:50 basis for a total peer-based valuation of QAR1.26/share.

Relative peer valuation comparison

Aamal is a diversified conglomerate headquartered in Qatar, with a market capitalisation of approximately £1.3bn. While substantial in absolute terms, Aamal is a mid-sized player within the regional conglomerate landscape, with a predominantly Qatari-focused business model.

The company’s concentrated geographic footprint and diverse operational portfolio present unique analytical challenges when attempting peer group comparisons. To provide market context, Exhibit 19 presents a selection of Gulf Cooperation Council and Egyptian listed companies spanning Aamal’s key business verticals, offering investors a nuanced perspective on regional valuation metrics and sector-specific benchmarking.

Aamal’s revenue grew 1.1% y-o-y in FY24. Both net profit attributable to shareholders and EPS increased c 18% y-o-y at FY24, to QAR432.5m and QAR0.069 respectively. Continued financial discipline and effective cost management allowed Aamal to maintain its strong balance sheet, with gearing marginally up by 0.11pp y-o-y to 2.52%, with a net debt/adjusted EBITDA ratio of 0.43x (FY23: 0.45x). Total net debt for FY24 stood at QAR216.0m.

Management remains confident on the company’s outlook, having improved Aamal’s competitive positioning in Qatar through new contract wins (new contracts and upwards revision of lease agreements at CCD and renewed services contracts in its trading and distribution segment) and expansion into new markets throughout FY24. This is backed by Qatar’s strong forecast for GDP growth and Aamal’s significant involvement in major infrastructure and energy projects in Qatar.

For our financial model and projections, our key assumptions and forecasts include the following:

• A 0.1% effective tax rate from FY25 (on our calculations end-FY24 taxation rate was 0.1%). Standard corporation tax rate of 10% in Qatar only applies to foreign ownership within companies. At FY24 Aamal’s foreign ownership stood at 1.32%.
• Revenue growth across the entire business trending upwards in the near term, at 8% in FY25e and 8% in FY26e, in line with IMF real GDP forecasts (Exhibit 6). Our forecast revenue growth CAGR between FY25e and FY28e is 6.1%. FY25 and FY26 are our explicit forecast years, with 2027 onwards being for the purpose of the DCF. We assume an EBIT margin of 19% to 20% for the forecast period and 18% in the longer term, with an FY24 EBIT margin of 18% (FY23: 16%).
• Accelerated revenue growth across Aamal’s entire business in FY27 and FY28, due to macroeconomic headwinds and the Qatari government’s focus on healthcare continuing to increase. The government has allocated QAR41.4bn to healthcare and education in 2025 (20% of total budget), having previously allocated 11% (QAR21.1bn) of the 2023 national budget to healthcare, which was similar to 2022 and marginally up from 2021 (QAR20.0bn), and we expect this trend to continue.
• Capex depreciation of 77% and 86% in FY25e and FY26e, respectively (FY24: 69%). We forecast capex increasing in the next few years, on the back of government initiatives to capture upside in Qatar’s non-hydrocarbon sectors.
• Reported EPS in FY24 was QAR0.07, up from FY23 (QAR0.06). While Aamal paid no dividends in FY24, the board has proposed a QAR0.06 dividend payment for FY25, which is awaiting confirmation at the AGM in the next few months (FY23: QAR0.05). We forecast EPS to grow marginally to QAR0.078 in FY25e and QAR0.084 in FY26e. We forecast dividend payout ratios of 50% and 78% in FY25e and FY26e, respectively (FY23: 0%), until there is commentary from management on its dividend policy. We have therefore modelled the company’s FY24 dividend as zero.
• Our forecasts assume a strong balance sheet is maintained, with net debt/adjusted EBITDA of 0.43x in FY24 (0.45x in FY23).

Risks and sensitivities

Aamal presents a compelling investment proposition through its diversified business model, offering strategic exposure to Qatar’s growth trajectory while maintaining a balanced risk profile. Qatar’s robust macroeconomic fundamentals, characterised by strong projected real GDP growth and supportive fiscal policies, provide a favourable operating environment. However, several key risk factors warrant careful consideration.

LNG market dynamics

Qatar’s LNG revenue stream faces mounting pressure from evolving market dynamics. Potential volatility in global oil prices directly affects LNG revenues, while increasing competition from US and UAE suppliers to key Asian markets poses additional challenges. With LNG contributing approximately 40% to Qatar’s annual GDP, any significant market disruption could affect government spending capacity in non-hydrocarbon sectors. In contrast, this scenario could accelerate Qatar’s economic diversification initiatives, potentially benefiting Aamal’s strategic positioning in non-hydrocarbon sectors.

Capital-intensive company

Aamal’s business model is characterised by capital-intensive requirements across its operational segments. The company faces material ESG considerations, particularly regarding climate-related regulatory, physical and socioeconomic risks. Management has articulated a strategic focus on energy efficiency and emissions reduction, though execution risks remain given the capital-intensive nature of such initiatives.

Economic integration risk

Aamal’s deep integration in Qatar’s economy creates both opportunities and vulnerabilities. The company’s growth trajectory is intrinsically linked to government initiatives in non-hydrocarbon sectors, particularly the NDS3 and Qatar National Vision 2030. Any delays in Qatar’s planned LNG capacity expansion (targeted to be complete by 2030) could materially affect the broader economic diversification agenda and, consequently, Aamal’s growth prospects.

Geopolitical risks

Operating within the MENA region exposes Aamal to significant geopolitical risks. Regional political dynamics and potential disruptions to maritime trade routes could affect Qatar's export-driven economy, creating operational and strategic challenges for the company’s business operations and growth initiatives.

ESG

Qatar faces notable ESG challenges and pressures, including environmental sustainability, especially in recent times with its rapid economic development and global sporting events. The nation’s hydrocarbon-dependent economy presents significant climate transition risks, while its labour ecosystem continues to evolve under global workforce standards, particularly concerning migrant worker protections.

Interactive version of Edison model

An online interactive version of our Aamal model is available here, powered by Stellar Fusion, where investors can run their own scenarios.