Riyadh – Mubasher: Al Rajhi Capital upgraded its valuation on the National Shipping Company of Saudi Arabia (Bahri) to “Neutral”.

The research firm maintained the stock’s price target (PT) unchanged at SAR 38.6, leaving a 6% upside rate, bearing in mind that it had fallen 16% from the previous PT set in Q4-16.

“2017 will be challenging both in terms of tanker rates (no significant floating storage requirements, and higher commissioning of Very Large Crude Carriers globally) and higher bunker prices,” the report said.

Al Rajhi Capital noted that Bahri’s Q1-17 results beat its estimates and the consensus ones, backed by revenue which amounted to SAR 1.94 billion.

Bahri profits retreated 38.19% to SAR 378.86 million in Q1-17, compared to SAR 612.92 million in the year-ago period.

The research firm attributed the decrease in Q1 profits to higher tanker rates and lower bunker prices.