We derive our SAR20.5 target price from an average of our EV/EBITDA multiple valuation and DCF-based valuation. Multiple-based valuation: we assume 10x 2026E EV/EBITDA, implying ~18x P/E, in line with regional leader Talabat. DCF-based valuation: we assume a WACC of 10% and a TGR of 3%, with a terminal-year EBITDA/GOV margin of 2.7%.

Key risks that could cause the shares to trade above our target price include: lower -than- expected margin investments to defend market share, less aggressive actions by competitors, faster ramp-up outside of the KSA, regulatory changes and execution.