Alinma Investment: Detailed Analysis of Financial Performance and Services in

Alinma Investment was founded in 2009 as a closed joint-stock company, wholly owned by Alinma Bank, to serve as a specialized investment arm for the bank's clients and the Saudi financial market in general. The company has obtained a license from the Capital Market Authority to conduct asset management, brokerage, custody, and investment fund issuance activities, making it a key player in the Saudi financial sector.

Since its inception, Alinma Investment has focused on innovation in investment solutions and developing products that meet the needs of local investors, adhering to the highest standards of governance and transparency. The company's authorized capital is one billion Saudi Riyals, with paid capital of 500 million Riyals, reflecting its strong financial position and ability to expand. The company operates under the supervision of a board of directors comprising financial experts and adopts a balanced developmental strategy that combines sustainable growth with risk management.

Alinma Investment is fully owned by Alinma Bank, one of the largest Islamic banks in Saudi Arabia. This affiliation provides the company with a broad customer base and strong financial and strategic support. The organizational structure consists of a board of directors that includes representatives from Alinma Bank and independent investment experts, along with specialized teams in asset management, product development, internal auditing, compliance, and information technology.

Investors in the company have confidence in the strength of governance due to strict adherence to the regulations of the Saudi Capital Market Authority and the adoption of transparent decision-making and disclosure policies. The company is also subject to periodic reviews by audit committees and external consultants to ensure compliance with local and international standards.

Alinma Investment offers a wide range of financial and investment services targeting various customer segments, both individuals and institutions:

1. Asset Management: Includes financial portfolio management and diverse investment funds (stocks, bonds, cash instruments, real estate funds, etc.), focusing on achieving balanced returns and diversifying risks.
2. Investment Fund Issuance: The company provides traditional and Sharia-compliant investment fund solutions and continuously launches new products that meet market needs, such as Saudi and Gulf equity funds and sukuk and real estate funds.
3. Financial Brokerage: The company offers trading services in local and international stocks, providing advanced electronic platforms that allow for efficient and rapid order execution.
4. Custody Services: Includes the safekeeping of securities and management of investor records, ensuring security and transparency for clients.
5. Investment Consulting: The company provides specialized financial consulting for companies and individuals regarding financial structuring, risk management, and the implementation of investment strategies.

The financial indicators for Alinma Investment reflect strong financial performance in recent years. According to official data until the end of 2025:

- Stock Price: 25.80 Saudi Riyals.
- Market Capitalization: 1.25 billion Saudi Riyals.
- Price-to-Earnings Ratio (P/E): 13 times.
- Dividend Yield: 4.0%.
- Annual Revenue Growth: Exceeded 25% in 2024 compared to 2023.

These figures demonstrate the company's ability to achieve sustainable growth in revenues and profits, with an attractive dividend distribution policy for shareholders. The moderate P/E ratio reflects the company's ability to achieve balanced future profits compared to the sector average. This performance relies on the expansion of investment products, an increase in managed assets, and effective cost management.

Alinma Investment witnessed significant growth in its revenues and profits in 2024. For example, in the third quarter of 2024, operating revenues reached approximately 150 million Riyals, a 12% annual increase, and net profit reached 30 million Riyals, a 15% growth compared to the same quarter of the previous year. In the fourth quarter, revenues rose to 170 million Riyals and net profit to 35 million Riyals (17% growth).

The company's total profits for the year amounted to approximately 120 million Riyals, an increase of over 25% compared to 2023. Earnings per share rose to 3.0 Riyals at the end of June 2025 compared to 2.4 Riyals at the end of 2024. This positive performance is attributed to an increase in managed assets and improved portfolio performance, in addition to the company's success in attracting new clients and expanding its products.

Alinma Investment falls under the financial services sector, specifically investment and asset management companies. This sector is experiencing continuous growth driven by several factors:

1. Regulatory Development: The sector is overseen by the Capital Market Authority, which imposes strict standards for transparency and governance, enhancing trust and protecting investors.
2. Technological Innovation: The sector is witnessing a significant shift towards digital services, with companies providing advanced electronic platforms for investors and focusing on developing Fintech solutions.
3. Economic Growth: Saudi Vision 2030 supports the development of the financial sector and the expansion of the local and international investor base, increasing the volume of managed assets.
4. Competitiveness: The sector is characterized by strong competition between independent investment banks and those affiliated with major banks, driving innovation and product development.

This environment provides growth opportunities but also imposes ongoing challenges related to adapting to technological and regulatory changes and shifting customer preferences.

Alinma Investment faces strong competition from major investment firms in the Saudi market, including:

1. Jadwa Investment: Known for its diverse funds and asset management services.
2. NCB Capital: The investment arm of the National Commercial Bank, with a significant share in fund management and brokerage.
3. Al Rajhi Capital: Offers diverse solutions in Islamic investment and asset management.
4. Saudi Financial Company: Provides asset management and financial brokerage services.

The market share of each company varies based on its customer base, the volume of managed assets, product innovation, and brand reputation. This competition drives investment firms to enhance service quality, develop specialized products, and adopt the latest financial technologies.

Alinma Investment adopts a policy of diversifying investment products to meet the needs of a diverse customer base. Its key products include:

1. Equity Funds: Allow investors to gain exposure to local and international stock markets through professionally managed funds.
2. Sukuk and Bond Funds: Provide investment in Sharia-compliant and traditional debt instruments, with the potential for fixed returns and reduced risks.
3. Real Estate Funds: Enable investors to benefit from the local real estate sector, with the potential for periodic profit distributions.
4. Specialized Funds: The company has launched new funds in sectors such as technology and real estate in partnership with real estate developers, reflecting the company's flexibility in meeting market demands.
5. Private Investment Portfolios: Offer tailored solutions for high-net-worth clients, with active asset management and calculated investment diversification.

Alinma Investment has placed significant importance on digital transformation in recent years, developing advanced digital platforms for securities custody, trading operations, and portfolio management. The company has introduced electronic solutions that allow clients immediate access to their accounts, view performance reports, and execute orders quickly and securely.

The company has also formed technological partnerships to enhance its digital infrastructure and adopt artificial intelligence solutions in financial data analysis and providing customized consulting. These efforts aim to improve operational efficiency, enhance customer experience, and reduce operational costs. Digital transformation has become a vital factor in competitiveness within the Saudi financial services sector.

Alinma Investment is committed to the highest standards of governance and risk management in response to the requirements of the Saudi Capital Market Authority. This includes:

1. Independent internal audit and review committees that ensure compliance with policies and laws.
2. Strict policies for managing market, operational, and credit risks, with continuous updates to preventive measures and adaptation to changes.
3. Commitment to transparent disclosure of financial results, distributions, and any significant events affecting operations.
4. Periodic reviews by external consultants to ensure quality and compliance with international standards.

These policies enhance investor confidence and mitigate risks associated with market volatility and operational risks while maintaining business continuity.

Alinma Investment has witnessed significant developments in the past two years, including:

1. Double-digit growth in profits and revenues during 2024, enhancing investor confidence.
2. Launch of new investment funds in equities and real estate, in partnership with real estate developers.
3. Changes in the composition of the board of directors of some funds and strengthening governance policies.
4. Digital expansion through the development of new electronic platforms and attracting clients from the Middle East and North Africa.
5. Active participation in the debt market through the issuance and management of government sukuk and bonds.

These developments reflect the company's dynamism and readiness to adapt to changes in the financial sector, with a focus on expansion and innovation.

Alinma Investment is keen on distributing annual cash dividends to shareholders, making its stock attractive to investors seeking regular income. The dividend yield at the end of 2024 was approximately 4.0% of the stock price, which is competitive within the Saudi investment company sector.

The distribution policy is based on its annual financial performance, and distributions are approved at the general assembly after reviewing the results and the board's recommendation. The distributions represent an indicator of the company's financial stability and its commitment to adding value to shareholders. The company is also committed to transparent disclosure of distribution dates and amounts through the Tadawul platform and its official website.

Although the company does not announce all details of its expansion plans before obtaining official approvals, current indicators suggest:

1. Development of specialized investment products (sector funds, Sharia-compliant funds, etc.).
2. Digital expansion to provide electronic investment services and reach a broader customer base.
3. Partnerships with international institutions in asset management or knowledge transfer.
4. Focus on attracting new clients from the Gulf and North Africa.

These plans reflect the company's desire to capitalize on economic growth in the Kingdom and expand its market share while maintaining service quality and adherence to regulatory standards.

The financial services and investment sector faces several risks, including:

1. Market Volatility: Significant fluctuations in stock or debt markets can affect the value of managed assets and the company's profits.
2. Regulatory Risks: Any changes in the Capital Market Authority's policies may impose additional requirements on companies, impacting costs and profitability.
3. Competition: Intense competition with other investment firms may lead to pressure on profit margins.
4. Operational Risks: Includes system errors, cyberattacks, or technical failures.

Alinma Investment relies on product and service diversification and professional risk management to minimize the negative impacts of these risks as much as possible, focusing on sustainable growth and maintaining customer trust.