Saudi Arabia Leads GCC IPO Market with $2.1 Billion Raised
In a stunning display of financial prowess, Saudi Arabia dominated the Gulf Cooperation Council’s initial public offering market in the first half of 2024, raising a staggering $2.1 billion. This marked a jaw-dropping increase of 141% from the previous year, according to a detailed analysis.
Kingdom’s IPO Success Story
The Kingdom of Saudi Arabia witnessed a flurry of 19 IPOs in the first six months of the year, accounting for a commanding 59% of the total IPO proceeds in the GCC region. These offerings included $1.95 billion listed in the main market and $143 million in the parallel market, known as Nomu.
Saudi Arabia’s ambitious privatization and diversification efforts across key sectors like healthcare, technology, and renewable energy have attracted investors and broadened the market’s appeal. These initiatives provide investors with exposure to high-growth industries, positioning the Kingdom as a prime destination for investment in sectors poised for significant development and innovation.
Saudi Capital Market Soars
Bolstered by the forward-thinking Capital Market Authority driving Vision 2030 goals, the Saudi capital market is witnessing a period of expansion. Net foreign investment reached an impressive SR198 billion ($52.79 billion) in 2023, marking a robust 7.7% annual increase, as reported by CMA in June.
Top IPOs in the GCC
Among the top five GCC IPOs by proceeds in the first half of 2024, Dr. Soliman Abdulkader Fakeeh Hospital Co. stole the show with a whopping $764 million raised on Saudi Arabia’s main market. The healthcare giant offered 49.8 million shares, garnering an oversubscription of 119 times and accounting for 21% of the total GCC IPO proceeds.
Alef Education, listed on the Abu Dhabi Securities Exchange, secured the second spot with its IPO raising $515 million, followed by Parkin Co. on the Dubai Financial Market with $429 million. Spinneys Co. and Modern Mills Co., both making significant IPO contributions, rounded out the top listings.
Overview of GCC IPO Market
Despite a decline in IPO activity in terms of value across the GCC region, the total proceeds reached $3.1 billion from 23 offerings in the first half of 2024. The UAE, specifically DFM and ADX, and Kuwait made notable contributions to the IPO market. The healthcare and technology sectors emerged as frontrunners in fundraising.
Middle East IPO Outlook
Looking ahead, IPOs in the Middle East are poised for continued positive aftermarket performance in 2024. The Saudi Stock Exchange has solidified its position as a dominant force in the GCC equity market, with recent enhancements attracting international investors.
The introduction of ‘Market Making’ and ‘Single Stock Options’ on Tadawul, as well as the Companies Law reforms, have further bolstered investor confidence and market accessibility in Saudi Arabia.