Aramex (ARMX.DU) A Regional Brand on a Global Mission Equity Research Initiation Coverage May 27th, 2008 Current Price: AED 2.55 Country: United Arab Emirates Fair value Target: AED 3.08 Sector: Logistics Recommendation: BUY Exchange: Dubai Financial Market • From a small express wholesaler for the Middle East, Aramex has evolved to a Middle East focused worldwide provider of integrated supply chain solutions. The company has more Sector Coverage Team recently embarked upon an aggressive expansion strategy to position and retain its place amongst the leading players of the industry, and capitalizing on a Global Distribution Alliance, Kareem Z. Murad in which it is one of the largest members. +9714 3199 757 • While remaining an asset light operation, Aramex has nevertheless grown to incorporate
[email protected] 307 offices in 195 cities, employing over 7,000 employees and serving a client base of over 50,000 companies, based mainly in the ME, Europe, India and America. The asset light nature Rasha Hamdan, CFA, FRM of the operation has kept CAPEX of less than 5% of revenues, although an increasingly active +9714 4283 525 acquisition strategy should utilize much of the company’s cash and impact its capital structure
[email protected] going forward. • Aramex retains a significant competitive advantage within its core market of the Middle East. The company is targeting further geographic expansion in an effort to set up a robust global network, however, the Middle East region is likely to remain the dominant region, and hence should be the main growth driver for the company for the foreseeable future.