ADNOC Drilling "L-T upside - 1Q26 Review" (Buy) Kishmariya

Research evidence excerpt

ADNOC Drilling "L-T upside - 1Q26 Review" (Buy) Kishmariya

Global Research

12 May 2026ab

ADNOC Drilling Equities

Arab EmiratesL-T upside - 1Q26 Review

Oil Drilling, Equipment & Services

12-month rating Buy

Adnoc Drilling results were broadly in line with estimates with positive surprise

on the FCF side. We found reassuring the group's comments that no material

12m price target Dh7.00

impact on operations were visible in April-May, similarly to March. The group

Prior : Dh6.20

expects more colour on the mid-term outlook with 3Q results as timing should

coincide with ADNOC budget preparation. Also the group echoed previous Price (11 May 2026) Dh6.28

Ministry of Energy comments regarding approaching FID for unconventional. RIC: ADNOCDRILL.AD BBG: ADNOCDRI UH

Risks related to the Iran conflict persist in the near-term, but we think these are

outweighed by the long-term positive outlook under the assumption a Trading data and key metrics

resolution is found soon. We reiterate Buy and increase PT by 13% to AED7.0. 52-wk range Dh6.43-4.73

Market cap. Dh100b/US$27.4b

Highlights from conference call Shares o/s 16,000m (ORD)

Free float 16%

No visible disruption 2QTD. The group's management confirmed that so far in

April and May there was still no visible disruption to operations due to the Iran Avg. daily volume ('000) 13,822

conflict, similarly to March levels. Avg. daily value (m) Dh75

Common s/h equity (12/25E) US$4.10b

Lower unconventional phase out should be offset by more conventional P/BV (12/25E) 6.7x

activity. The group expects lower Turnwell revenue for 2Q in a magnitude of ~

$50m drop (from $131m in 1Q). This however should be offset by increased EPS (UBS, diluted) (USD)

international contributions (MBPS deal completion in May) and increased number From To % ch Cons.