SMC Wins SAR 3.8B Psychiatric Hospital Contract, Shares Jump

Specialized Medical Co. (SMC) said its subsidiary, Al-Mukhtas Al-Sehhi Medical, in which it holds a 51% stake, received a project award letter from Saudi Arabia's Ministry of Health to manage a psychiatric hospital in Riyadh. The contract is valued at SAR 3.8 billion over 15 years.

Shares of SMC rose 2.5% on the Saudi exchange after the announcement. The stock has gained roughly 18% year-to-date, outperforming the broader Tadawul index.

The hospital will have a capacity of 1,000 beds, making it one of the largest psychiatric facilities in the kingdom. SMC will handle operations, staffing, and clinical services under the agreement. The Ministry of Health retains oversight of regulatory compliance and quality standards.

SMC already manages several hospitals and medical centers across Saudi Arabia, including facilities in Riyadh, Jeddah, and Dammam. The company reported revenue of SAR 1.2 billion in 2025, with net income of SAR 180 million.

The contract adds a long-term recurring revenue stream to SMC's portfolio. Management said the hospital is expected to begin operations in phases starting in 2027, with full capacity reached by 2029.

Saudi Arabia has been expanding its mental health infrastructure as part of the Vision 2030 healthcare transformation. The kingdom plans to increase psychiatric bed capacity by 40% by 2030, according to the Ministry of Health's strategic plan.

The award letter is valid for 90 days, during which SMC and the ministry will finalize the contract terms. The company said it will disclose further details once the agreement is signed.