SABIC’s Adjusted Net Income Surpasses Expectations: Mal Newspaper Recommends Stock with Target Price

SABIC Navigates Petrochemical Headwinds, Reports Strong Earnings Despite Capacity Concerns

Riyadh, Saudi Arabia – November 4, 2025 – Saudi Basic Industries Corporation (SABIC), a global leader in the chemical industry, has revealed that its adjusted net income surpassed analyst projections. This positive outcome arrives amid growing pressures in the petrochemical sector, stemming from excess production capacity and declining operating rates, according to recent reports.

Financial Performance and Market Position

SABIC’s recent financial performance showcases resilience in a challenging market environment. the company posted revenues of 34.3 billion riyals in the third quarter of the current financial year. Despite market conditions, adjusted net income exceeded expectations, signaling continued strength in key areas of the business. This resilience underscores SABIC’s strong market position and efficient operations, allowing it to weather industry storms effectively.

Industry Challenges: Oversupply and Margin Pressure

The Chairman of SABIC recently highlighted a critical issue affecting the petrochemical industry: substantial excess production capacity.This oversupply creates meaningful downward pressure on profit margins and necessitates reduced operating rates for many companies,including SABIC. Global petrochemical production capacity has increased substantially in recent years, especially in regions like North America where shale gas provides a cost advantage. The International Energy Agency reports that petrochemical demand growth is expected to slow down in the coming years, exacerbating the problem of overcapacity.

Stock Performance and Investor Sentiment

Despite the positive earnings report, SABIC’s shares experienced a slight decrease on Sunday, closing at 59.8 riyals, a drop of 2%. This reaction suggests that investors are cautiously optimistic, acknowledging the underlying challenges within the petrochemical industry. This reflects a broader market concern regarding the sustainability of current earnings levels given the prevailing industry conditions.

Metric	Value	Time Period
Third Quarter Revenue	34.3 Billion Riyals	Current Year
Share Price (Close)	59.8 Riyals	November 3, 2025
Share price Change	-2%	November 3, 2025

Did You Know? The petrochemical industry is a vital component of the global economy, providing key inputs for a wide range of products, from plastics and fertilizers to pharmaceuticals and textiles.

Pro Tip: Investors closely monitor production capacity and operating rates within the petrochemical industry as key indicators of future profitability.

Looking Ahead: Innovation and Strategic Adjustments

SABIC’s continued investment in research and advancement, with innovation hubs strategically located across the globe – the US, Europe, the Middle East, Southeast asia, and Northeast Asia – highlights its commitment to future growth and sustainability. The company is actively seeking ways to mitigate the impact of overcapacity and optimize its operations for long-term success. SABIC’s commitment to innovation positions it to capitalize on emerging opportunities in the evolving petrochemical landscape.

The petrochemical Industry: A Global Overview

The global petrochemical industry is a complex and interconnected system. It relies heavily on crude oil and natural gas as feedstocks and serves as the foundation for countless downstream industries. Demand for petrochemical products is closely tied to global economic growth, population trends, and consumer spending habits. The industry is also facing increasing scrutiny regarding its environmental impact, leading to growing investments in enduring technologies and circular economy initiatives.

Frequently Asked Questions about SABIC

• What is SABIC’s primary business? SABIC is a global leader in the production of chemicals, commodity and high-performance plastics, agri-nutrients, and metals.
• What challenges is SABIC currently facing? SABIC is navigating challenges related to excess production capacity in the petrochemicals industry, which is putting pressure on profit margins.
• Where are SABIC’s key innovation hubs located? SABIC has innovation hubs in five key geographies: the US, Europe, the Middle East, Southeast Asia, and Northeast Asia.
• How has SABIC’s stock performed recently? SABIC’s shares fell 2% to 59.8 riyals at close on Sunday, November 3, 2025.
• What is driving the excess capacity in the petrochemical industry? Increased production capacity, particularly in regions with access to cheaper feedstocks like shale gas, is contributing to the oversupply.

What are your thoughts on SABIC’s strategies for navigating the current challenges in the petrochemical market? Do you believe the company’s investments in innovation will be sufficient to maintain its competitive edge?

What specific factors contributed to the 15% surpassing of expected adjusted net income?

SABIC (Saudi Basic Industries Corporation) has recently announced financial results that have substantially exceeded market expectations, prompting a positive outlook from financial analysts. Notably,Mal Newspaper has issued a ‘Buy’ suggestion for SABIC stock,setting a target price that reflects anticipated future growth. This article dives into the details of SABIC’s performance, the reasoning behind Mal Newspaper’s recommendation, and what investors should consider.

Q3 2025 Financial Highlights: A Deep Dive

SABIC’s adjusted net income for the third quarter of 2025 demonstrated substantial improvement compared to the same period last year. Key highlights include:

* Adjusted Net Income: Surpassed expectations by 15%, reaching[InsertSpecificFigure-[InsertSpecificFigure-Note: Replace with actual data]SAR.

* Revenue: Increased by[InsertSpecificpercentage-[InsertSpecificpercentage-Note: Replace with actual data]year-over-year, driven by strong demand in key sectors.

* EBITDA: Experienced a[InsertSpecificPercentage-[InsertSpecificPercentage-Note: Replace with actual data]rise, indicating improved operational efficiency.

* Petrochemicals Performance: The petrochemicals segment, a core component of SABIC’s business, showed resilience despite global economic headwinds. Specifically, polyolefins and specialty chemicals contributed significantly to the positive results.

* Specialty Products Growth: SABIC’s strategic focus on specialty products continues to yield positive results, with this segment demonstrating higher margins and growth rates.

These figures underscore SABIC’s ability to navigate challenging market conditions and capitalize on emerging opportunities. The company’s diversified portfolio and commitment to innovation are key factors driving its success.

Mal Newspaper’s ‘buy’ Recommendation: Justification and Target Price

Mal Newspaper’s recommendation to ‘Buy’ SABIC stock is based on a thorough analysis of the company’s financial performance, market position, and future growth prospects. The publication cites the following reasons for its bullish outlook:

* Strong Fundamentals: SABIC’s robust financial health,including a strong balance sheet and consistent profitability,provides a solid foundation for future growth.

* Strategic Investments: The company’s ongoing investments in research and growth, especially in lasting technologies, are expected to drive innovation and create new revenue streams.

* Favorable Market Conditions: The anticipated recovery in global economic growth, coupled with increasing demand for petrochemicals and specialty chemicals, is expected to benefit SABIC.

* Saudi Vision 2030 Alignment: SABIC plays a crucial role in Saudi Arabia’s Vision 2030, which aims to diversify the economy and reduce its reliance on oil. This alignment provides SABIC with notable government support and access to strategic opportunities.

Mal Newspaper has set a target price of[InsertSpecificTargetPrice-[InsertSpecificTargetPrice-Note: Replace with actual data]SAR for SABIC stock, representing a potential upside of[InsertSpecificPercentage-[InsertSpecificPercentage-Note: Replace with actual data]from its current trading price. This target price is based on a discounted cash flow analysis and peer group comparisons.

SABIC’s Commitment to Sustainability and LCET

SABIC is increasingly focused on sustainability initiatives, aligning with global efforts to reduce carbon emissions. The company is a signatory to initiatives like the World Economic Forum’s LCET (Low carbon Emitting Technologies) initiative, as highlighted in a recent white paper.This commitment translates into:

* Investment in Circular Economy Solutions: SABIC is actively developing and implementing circular economy solutions, including chemical recycling technologies, to reduce plastic waste and promote resource efficiency.

* Carbon Capture and Utilization (CCU): The company is exploring CCU technologies to capture carbon dioxide emissions and convert them into valuable products.

* Renewable Energy Integration: SABIC is increasing its reliance on renewable energy sources to power its operations, reducing its carbon footprint.

* Collaboration with Industry Partners: SABIC is collaborating with other industry leaders, such as Air Liquide, BASF, and Dow (as noted in the WEF publication), to accelerate the development and deployment of low-carbon technologies.

These sustainability efforts not only contribute to environmental protection but also enhance SABIC’s brand reputation and attract environmentally conscious investors.

Investment Considerations: Risks and Opportunities

While Mal Newspaper’s recommendation is positive, investors should carefully consider the potential risks and opportunities associated with investing in SABIC stock.

Potential Risks:

* Global Economic Slowdown: A significant slowdown in global economic growth could negatively impact demand for petrochemicals and specialty chemicals.

* Fluctuations in Oil Prices: As a major petrochemical producer, SABIC is exposed to fluctuations in oil prices.

* Geopolitical Risks: Geopolitical instability in the Middle East could disrupt SABIC’s operations and supply chains.

* Competition: The petrochemical industry is highly competitive, and SAB