Seera Holding Risk/reward looks balanced; conservative estimates and room for value unlocking… Remain Neutral

Research evidence excerpt

Seera Holding Risk/reward looks balanced; conservative estimates and room for value unlocking… Remain Neutral

rmance: We forecast Seera’s revenues to decline by

8% YoY in FY 26, and the clean bottom line to grow 2% YoY. While we expect Style Exposure

Q2 to be the most affected quarter from the ongoing regional crisis, we bake

in a gradual recovery in the business into H2 26E. On FY 26E segmental

performance, we expect: 1) Almosafer NBV growth slowing down to 6% YoY,

with adj. EBITDA/NBV at 1.1% (-10bps YoY) driven by consumer travel’s

market share expansion efforts amidst a competitive landscape; 2) Lumi’s

EBITDA margin to contract by c. 150bps YoY driven by weaker rental demand,

ongoing de-fleeting at NEOM and weakness in the used car sales market; 3)

Portman NBV -12% YoY, yet EBITDA/NBV should improve by c. 40bps YoY

to 2.3% supported by operational efficiencies post the restructuring and

realisation of some M&A-related synergies; and 4) Hospitality EBITDA -13%

YoY, although divestment remains the key deliverable here.

• Almosafer IPO could be a key trigger: The company plans to complete the

IPO of Almosafer within the next 6-12 months, which we believe could provide

some scope for value-unlocking in the near term. That said, we remain

conservative in the current backdrop with FY 27E NBV and EBITDA margin

of SAR 11.3bn and 1.5%, vs. guidance of SAR 12bn and 1.8-2.0%,

respectively. We value Almosafer at SAR 2.7bn, which is a c. 30% discount to

the PIF-implied valuation of SAR 3.75bn in late 2022 (assuming a value tag in

line with the PIF deal could translate into a 16% uplift to our valuation).

• We remain conservative in our valuation: Our SoTP reflects: 1) Almosafer’s

implied valuation at 2.1x FY 27E EV/revenue, lower compared to