UBS: Fast Take: Parkin Company PJSC "Parkin applies retroactive VAT; AED 78m..."

研报英文原文证据摘录

UBS: Fast Take: Parkin Company PJSC "Parkin applies retroactive VAT; AED 78m..."

Forecast returns

Forecast price appreciation 12.7%

Forecast dividend yield 3.7%

Forecast stock return 16.4%

Market return assumption 8.9%

Forecast excess return 7.4%

Company Description

Parkin is Dubai's largest public parking operator, overseeing paid on- and off-street parking

through a long-term concession with the RTA. Its growth is being driven by enhanced parking

capacity, widespread implementation of smart parking solutions, and its recently announced

plans to expand into Abu Dhabi and Saudi Arabia.

Valuation Method and Risk Statement

We value Parkin using a DCF methodology. The key risks include

Regulatory & Concession Agreement risk - Parkin’s 49-year Concession Agreement exposes it

to changes in RTA policies, concession fee structures, tariff frameworks, and any upward

revision in concession fee rates. Any adverse adjustment could materially impact margins and

cash flow.

Tariff induced utilization risk - The shift to variable pricing from April 2025 significantly affects

customer behaviour and utilization trend. Misalignment between tariff structures and

customer demand could reduce utilization in sensitive zones (e.g., B & D), as evidenced by

notable utilization declines in recent quarters.

Developer parking portfolio risk - Developer parking volumes and spaces fluctuate due to

contractual changes and community handovers and varying quarterly additions or reductions.

Revenue exposure is elevated because developer parking is exempt from concession fees and

contributes disproportionately to operating profit.

Seasonal card pricing misalignment risk - Seasonal card volumes surged dramatically recently,

driven by a temporary price-value gap versus revised tariffs.