As published on The Peninsula Newspaper: Arqaam capital publishes Estithmar Holding Q.P.S.C Initiation Report

Arqaam capital, a specialist emerging markets financial services company recently published its Initiation Report on Estithmar Holding Q.P.S.C, which operates across five key market segments with a focus on healthcare, hospitality, contracting, services and a wide range of industries.
Estithmar Holding is a direct play on the growing healthcare exposure via its wholly owned and operated healthcare facilities, The View and the Korean Medical Center, while also growing its operational management model via long-term contracts with other facilities in the country and regionally (Iraq, Kazakhstan, Egypt, and Algeria). According to the report it is expected to have higher contribution from Healthcare and Ventures clusters and an increasing focus on cost efficiencies to support an EBITDA margin uplift from 12.2% in FY 22 to 19.9% in FY 27e.
According to arqaam capital report a strong growth runway, 3-yr EBITDA CAGR of 41.1%. In addition to a stable and long-term growth derived through higher contributions from multiple segments; key supporting market drivers include low healthcare/hospital penetration and supportive regulation, a strong pipeline of projects in Qatar, Iraq, and Saudi especially red Sea projects through PIF contracts, and increasing exposure to tourism via its venture’s exposure. The company aims to triple its EBITDA by 2025 (ACe 2.8x) and has budgeted QAR 2.1bn in CapEx.
Moreover, the report highlights a strong FCF in FY 24e; potential for dividend commencement in the near-term strong EBITDA growth will lead to improved FCF (as per the estimates highlighted by the report), despite significantly front-loaded CapEx. 
We initiate with a Buy rating and set a TP of QAR 2.64. Our DCF-based valuation yields an upside of 21% with a QAR 2.64/share TP. Estithmar Holding trades at 11.6x FY 24e EV/EBITDA, in-line with the sector, while offering superior growth prospects and a shift towards higher margin business. 
Source: arqaam capital
To read the full report please visit:

Pioneering investments in Qatar and abroad
The new projects exchange at Investment Holding includes a project to establish one of the largest cancer treatment centers in the Middle East, which will be inaugurated within two years, as the health care sector is considered one of the most attractive for investment. View Hospital was opened with an American partnership, while work is underway on the Korean Hospital, and the group seeks to strengthen its Projects aimed at making Doha a destination for medical tourism. On tourism sector, the group has completed many tourism projects, including Al Maha Island, Katara Hills Resort, and Maysan Resort.

The Investment Holding Company recently held a foundation stone laying ceremony for a huge tourist complex in Iraq, under the patronage and presence of His Excellency Eng. Muhammad Shiaa Al-Sudani, Prime Minister of Iraq; Vice Chairman of the Board of Directors of the Investment Holding Company, Ramez Al-Khayyat; members of the Board of Directors, in addition to personalities from various bodies and committees specialized in investment, tourism in Iraq, and the Investment Holding team.

Components of the project
The project contains a conference centre, celebration halls, meeting rooms, various restaurants bearing the most famous international names, health clubs and all complementary facilities.

5 projects in Saudi Arabia 
The Kingdom of Saudi Arabia remains one of the most important destinations for the company, as Istithmar announced three projects in the specialized contracting sector in Saudi Arabia that have been revealed, in addition to two projects that have been started, bringing the number of projects we won to 5 projects.
On the other hand, Esthimar Holding’s projects grew substantially during the recent months with new subsidiaries across the globe. 
Over the past decade, Elegancia Facilities Management enhanced to become one of the largest facilities management organisations in the Middle East.
In July 2023, Estithmar Holding QPSC reported that its subsidiary in the Kingdom of Saudi Arabia ‘Elegancia Arabia Trading Company’, has been awarded two new MEP package works for the West Hotel 3 and 4 (200 keys each), along with the present MEP package works for the Central Hotel (430 Keys), and two hotels on the East side of the island (150 and 180 keys) in Al Shura Development.
However, these premium resorts are part of the 11 underway on the main hub island of The Red Sea destination under development in the Kingdom of Saudi Arabia and hold a LEED platinum rating and feature a built-up area of 88,269 sqm, marking this one of the largest developments in the Kingdom and a flag bearer for regenerative tourism worldwide.
The same month, Estithmar Holding announced that its subsidiary, Elegancia Facilities Management, secured part of the facilities management services of Queen Alia International Airport in Jordan. 
The subsidiary has partnered with the Jordanian Total Care Facilities Management to fulfill this bid.
The company also announced in April 2023 that its subsidiary “Elegancia Healthcare W.L.L.” has established a branch of the company in Iraq, as part of the company’s strategy to expand globally, and in accordance with the recently signed memorandum of understanding (MoU) with the Iraqi National Investment Commission, to manage and operate several hospitals in the country.

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