Tadawul to see influx of IPOs
Saudi Arabia boasts over ten companies eagerly awaiting to embark on initial public offerings (IPO) on its stock exchange, with over 50 firms vying for listings, signalling a sustained surge in IPO activity within the kingdom, Mohammed Al-Rumaih, CEO of Tadawul stock exchange, revealed in an interview with Bloomberg.
“We have more than ten IPOs approved but waiting for book building and dealing with the asset managers to determine listing and offering dates.”
Al-Rumaih further emphasised the diversity of these upcoming IPOs, spanning various sectors, sizes, and stages in their life cycles.
These comments follow a recent flurry of IPO announcements in Saudi Arabia, with four companies stepping into the spotlight in recent weeks.
Notably, the healthcare giant Dr Soliman Abdul Kader Fakeeh Hospital is poised to become the kingdom’s largest IPO of 2024, having sold out within an hour aiming to raise a staggering 2.86 billion riyals ($763.4 million) – surpassing the combined listings of the year thus far.
Similarly, Miahona’s water treatment business witnessed robust demand, leading to its offer being priced at the top of the initial range.
The total funds raised through Saudi IPOs this year have already exceeded $700 million, with the standout being Modern Mills Co.’s $314 million listing in March, representing a substantial increase from the previous year when listings stagnated amid a market decline. Moreover, the Tadawul index has seen a 4 per cent increase year-to-date.
Al-Rumaih, speaking at the Hong Kong edition of Saudi Arabia’s Capital Market Forum, expressed confidence in the market’s liquidity to absorb the anticipated listings.
Regarding the potential for Saudi Arabian companies to cross-list in Hong Kong or vice versa, he noted the importance of having a pathway prepared for such endeavors.
In a bid to enhance their stature as financial centres, the Saudi Tadawul Group and Hong Kong Exchanges & Clearing Ltd. are co-organising a conference, underscoring Saudi Arabia’s aspiration for increased foreign ownership in its stock market as part of Crown Prince Mohammed bin Salman’s Vision 2030 programme, according to Bloomberg.
Additionally, both bourses are collaborating on an ETF in Riyadh tracking Hong Kong’s stock indexes, complementing the existing ETF listed in Hong Kong tracking Saudi Arabian shares, with plans to cross-list it to Shanghai later in the year.
“The friendship and partnership between Hong Kong and Saudi Arabia will go very far and will endure the test of time,” said Michael Wong, Hong Kong’s deputy financial secretary.
