‎EFG-Hermes expects SRMG to join MSCI World Index

Logo of Saudi Research and Media Group

Saudi Research and Media Group (SRMG), a constituent of MSCI Saudi Arabia Small Cap Index, demonstrated excellent performance in 2021, surging nearly 150%. Accordingly, the stock is well-placed to join MSCI World Index, EFG-Hermes KSA said in a recent report.

The stock should maintain its current trading volumes until May 2022, to join MSCI World Index. The upgrade will attract $125 million cash inflows.

The upgrade could take place in early February instead of May, the report issuer added.

SRMG shares hit a life-time high today, Jan. 11, reaching SAR 237.60, gaining more than 200% since the beginning of 2021.

The stock closed 7% higher at an all-time high of SAR 233, after 500,000 shares were traded.

SRMG posted a net profit of SAR 204.9 million in Q3 2021, the highest quarterly earnings on record.

Established in 1987, SRMG transformed into a closed joint stock company in 2000. It was listed on the Saudi main market in May 2006.

The group ranks among top media houses regionally and globally. It is a leading source of news and information for more than 165 million readers, browsers and watchers on a monthly basis.

Led by Chief Executive Officer (CEO) Jomana Al-Rashid, SRMG’s digital transformation strategy is based on five key pillars.

The group has recently announced several deals and agreements, including the acquisition of Thmanyah as part of new digital-first growth strategy.

SRMG Stock Performance
Annual High (SAR)	237.60	Jan. 11, 2022
Annual Low (SAR)	72.70	Feb. 4, 2021
Historical High (SAR)	237.60	Jan. 11, 2022
Historical Low (SAR)	12.25	Aug. 24, 2015
Highest Traded Volume (mln shares)	44.16	Nov. 1, 2015

The following table shows the key financial indicators:

Key Financial Indicators
EPS (last 12 months) (SAR)	5.75
P/E (Last 12 months) (x)	40.51
Book Value (SAR)	24.48
P/B ratio (x)	9.52

The following is a breakthrough of the company’s events as of 2021-to-date:

Key Events in 2021
December	SRMG subsidiary bought SAR 300 million Saudi Government sukuk
November	SRMG reported a net profit after Zakat and tax of SAR 431 million for the first nine months of 2021 (+99% YoY), and SAR 204.9 million for Q3 2021.
October	SRMG completed all prerequisite conditions to acquire a stake in Thmanyah Company for Publishing and Distribution.
September	SRMG subsidiary, Taoq Public Relations Co., signed a SAR 252 million contract with a commercial firm engaged in advertising and public relations to provide operational services for multiple media platforms.
September	SRMG, Ministry of Education signed MoU with Manga Arabia to facilitate free distribution of “Manga Arabia Kids” Magazine
August	SRMG, Taoq PR signed SAR 204 million contract to provide media consulting services
July	SRMG subsidiary inked agreement to buy 51% of Thmanyah Publishing for SAR 33.3 million
June	SRMG subsidiary, Taoq Public Relations Co., signed a contract with a commercial company, specializing in publicity, advertising, public relations, provide media and consulting services, and produce multilingual international content.

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