The aim of this paper is to provide a brief overview of the performance of the Thimar organization. The National Agriculture Marketing Company (Thimar) primary activity is to market animal products & agricultural products. The key products which the company provides include fresh fruits, vegetables, meat products, and animal products. The paper not only analyzes the financial statements of the company critically but also compares it with its competitor Alothiam. Both Macro and Micro-level analysis have been performed for knowing the ley strengths and weaknesses of the company.

Macro Level of Financial statement Analysis of Thimar

For analyzing the performance and key strength of the Thimar Corporation, it important to understand the macrocosmic variables that affect the organizations. There are different factors that can influence the organization's performance and profitability. The stock prices of the company play an important role in the expansion and growth of the company. If the stock prices of the organizations are continuously experiencing a decline than it might be sign that there is something wrong with the organization’s performance. In the below sections the economic variables are discussed, which have major impact on the stock prices of the company.

Economic Variables that affect Saudi Stock Market

The financial markets in any country play an important role in the growth and expansion of the economy. However, there are several macroeconomic factors that have major impact on the efficiency and performance of the stock markets. The Saudi Stock market which is also known as Tadawul is influenced by various economic variables. Due to economic variables the stock price experience volatility. It is highly essential to understand which factors are causing an increase or decline in the prices of stock of certain companies so that the company can take steps to mitigate risky situations (Jarrah & Salim, 2016). The followings are some of the key economic variables that have an impact on the stock prices of the Thimar organization.

Inflation of Financial statement Analysis of Thimar

Inflation is a major factor that has a huge influence on stock prices. When inflation increases in any country, the price of goods & services increases, which results in a decline in the purchasing power of the customers. It is evident that when prices increase the people cannot afford products/services in large quantities. Inflation has a direct relationship with interest rates because high inflation results in high-interest rates. Usually banks increase interest rates for decreasing inflation. Due to this the stock prices experience a decline. In short it can be said that whenever Saudi Arabia experiences inflation the prices of stocks can experience decline (Jarrah & Salim, 2016).

Interest rates of Financial statement Analysis of Thimar

The interest rates can impact or influence the prices of stocks in the financial markets. The banks increase or decrease the interest rates for stabilizing the economic conditions in the country. The central bank of any country creates monetary policy in which it states the interest rate for managing the economy. If the interest rate in the country is high and the organizations in the country fiancé their assets through loans than the cost of debt will be higher. When the cost of debt of the organizations increases it means that their profitability will decline which means that the company will not pay a high amount of dividends to its shareholders or investors. The investors invest in corporations because they want high amount of return. When the amount of return declines the share prices of the specific company will experience a decline. So it is evident that when interest rates change, the stock prices of the company can also experience increase or decrease (Jarrah & Salim, 2016).

Exchange Rate Changes of Financial statement Analysis of Thimar

Whether it is Saudi Arabia or any other country, the consumers want different kinds of products and for these countries import products to other countries. When the price of foreign currency such as the US dollar experiences an increase it means that the customers will have to pay more for getting those goods. A rise in US stocks might bring down sales, which will eventually decrease the prices of the stocks of the company. Similarly, a decline in the US dollar might make products cheaper, which means that the sales of the company increase which can make the process of the stocks go higher (AL-GHALAYINI, 2019).

Economic Outlook of Financial statement Analysis of Thimar

The economic outlook of any country has the ability to influence the stock prices of any company. For instance, the Saudi Vision of 2030 has provided a bright future for Saudi Arabia. According to this vision, Saudi Arabia will diversify its economy which will help Saudi Arabia to expand its economy. When such news comes in the market the investors think that in the future the economy will experience growth due to which the prices of the stocks experience an increase. The investors start purchasing more stocks by thinking that in future they have the opportunity to increase their returns (Jarrah & Salim, 2016)

Economic policy of Financial statement Analysis of Thimar

The government of any country creates economic policy in which it implements various new rules and regulations for strengthening the economy. For instance, Saudi Arabia has come up with the vision of 2030 according to which the county will reduce its dependence on oil and will invest in other sectors for diversifying the economy. Such policies improve the economic outlook of the country which ultimately affects the stock prices. If the economic policies are in favor of the businesses than the stock process can experience growth. However, if the government puts any kind of restriction than it will become difficult for companies to increase their stock prices.

Sectorial Level
Industry Classification of Financial statement Analysis of Thimar

Characteristics of the Industry

The Food and beverage industry of Saudi Arabia is growing at a higher rate. The Halal food market in Saudi Arabia is approximately $6 billion. The current food and beverage industry of Saudi Arabia is valued at $45 billion. In the upcoming years, it is estimated that the food and beverage industry will grow with a rate of 6%. The Food & beverage industry of Saudi Arabia accounts for 10% of its GDP. Although Saudi Arabia produces food in the country but the import of food has also increased in recent years. In the year 2018 food industry has experienced a 10% growth in the imports of food items (AL-GHALAYINI, 2019).

The key competitors of Financial statement Analysis of Thimar

The following are the main competitors of the organization

Alothiam

Al-Jouf Agriculture Development Co

Saudi Fisheries Co.

Tabuk Agricultural Development Co

All the above-discussed corporations are the primary competitors of the organization. The discussed organization are part of the food & beverage industry and have their respective market share. The organization that is in the food industry is taking benefit from the growing food industry of Saudi Arabia and is generating a significant amount of revenue. However, due to various factors the sales of the corporations sometimes experience a decline, which affects the profitability of the company (Campbell, Edgar, & Stonehouse, 2011).

References of Financial statement Analysis of Thimar

AL-GHALAYINI, B. M. (2019). Investment opportunities in the Saudi food sector. Retrieved from https://www.arabnews.com/node/1482516

Campbell, D., Edgar, D., & Stonehouse, G. (2011). Business Strategy: An Introduction (3 ed.). Macmillan International Higher Education.

Jarrah, M., & Salim, N. (2016). The Impact of Macroeconomic Factors on Saudi Stock Market (Tadawul) Prices. 71-76.