Saudi Arabia to top GCC IPO market in 2024, raising $4.1 billion across 42 public offerings: Markaz
RIYADH: Saudi Arabia has strengthened its role in the Gulf Cooperation Council’s initial public offering market in 2024, raising $4.1 billion through 42 listings, the most in the region.
A new report from the Kuwait Financial Center, also known as Markaz, says the GCC region saw a 23% increase in IPO proceeds compared to 2023, reaching a total of $13.2 billion across 53 public offerings.
This growth represents a significant increase from the $10.7 billion raised through 46 listings the previous year.
Saudi Arabia accounted for 31% of total IPO proceeds in the region, making it the second-largest contributor after the UAE. Saudi exchange Tadawul has conducted 14 IPOs in major markets, raising a total of $3.8 billion. The parallel market Nomu also saw 28 IPOs, generating $297 million.
“Saudi IPOs recorded the best post-listing performance compared to other GCC markets, both in the primary and parallel markets,” Markaz said.
The biggest Saudi IPOs of the year included Dr. Soliman Fakeeh Hospital, Almoosa Health Group and Nice One, all of which attracted significant investor interest.
The energy sector emerged as the best-performing sector, raising $3.7 billion, accounting for almost 28% of the region’s total IPOs. This was mainly driven by Abu Dhabi’s NMDC Energy and Oman’s OQ Exploration and Production and OQ Base Industries, which attracted strong investor demand.
After energy, the consumer staples sector secured 24% of total IPOs, or $3.1 billion, with Lulu Retail Holdings, Spinneys and Saudi Modern Mills among the most notable.
The consumer discretionary sector raised $2.7 billion, accounting for 20% of total revenue, with major IPOs such as Talabat, Nice One and Abu Dhabi National Hotel Catering.
The healthcare sector followed suit, raising $1.4 billion, or 10% of total revenue, with support from Dr. Soliman Faqih Hospital and Saudi Arabia’s Al Moussa Health Group.
Meanwhile, the industrial sector generated $877 million from 11 services. In addition, financial services accounted for 5 percent, technology provision 4 percent, and utilities and materials each accounted for 1 percent of total revenue.
The UAE led the GCC IPO market for the third consecutive year, raising a total of $6.4 billion, accounting for 49% of the total IPOs in the region.
The UAE’s Abu Dhabi Stock Exchange has invested $3.6 billion through four IPOs, led by NMDC Energy and Lulu Retail Holdings.
Meanwhile, the Dubai Financial Market saw IPOs by Talabat, Perkin and Spinneys, raising a combined $2.8 billion.
Saudi Arabia followed suit with a more diverse range of IPOs across different market segments.
Oman saw strong growth in IPOs, raising $2.5 billion and recording its highest revenue ever. The country’s two major IPOs, OQ Exploration and Production and OQ Base Industries, were launched as part of the Oman Investment Authority’s divestiture strategy. OQEP’s IPO raised $2 billion, making it the largest IPO in U.S. history.
Kuwait returned to the IPO market after two years, hosting the IPO of Biyut Investment Group Holding, which raised $147 million on Bursa Kuwait. Bahrain has also seen IPO activity, with Al Abraaj Restaurant Group raising $24 million, becoming Bahrain’s first IPO since 2018. The sale of a 35 percent stake in the company accounted for 0.2 percent of GCC’s total IPO proceeds.
The report revealed that more than 59% of GCC IPOs saw stock prices soar within 30 days of listing.
Saudi Arabia recorded its best performance since going public, with technology, healthcare and consumer companies posting big gains. Among the standout IPOs was Miahona Co., whose stock price soared 147% within the first month of trading. The company had floated 30% of its capital in Tadawul’s main market in May.
Another major gainer was Purity for Information Technology, whose stock rose 118% in the first 30 days after Nomu debuted in October.
On the downside, some IPOs have seen declines, with Pan Gulf Marketing Inc.’s stock price falling 35% since its listing after debuting on Nomu in February 2024. Similarly, Yakeen Capital Inc. fell 28% after its IPO in June, reflecting investor concerns. Certain market segments, especially flour milling companies.
Most GCC equity sectors performed well in 2024, with Dubai Financial Market posting a 26.9% rise. Bursa Kuwait followed with a rise of 12.4%, while Muscat Securities Market and Bahrain Securities Market posted modest gains of 1.3% and 1.2%, respectively.
Meanwhile, Saudi Arabia’s Tadawul remained stable, rising 0.6%, while Qatar Stock Exchange and Abu Dhabi Stock Exchange were down slightly at -1% and -1.7%, respectively.
Saudi Arabia is expected to maintain its strong IPO momentum, with more than 50 IPOs expected over the next two years.
Seven IPOs have already received regulatory approval and are expected to launch in the first quarter of 2025. Other Gulf Cooperation countries, including the UAE, Qatar, and Oman, are also gearing up for large-scale IPO activity.
Founded in 1974, Markaz is a respected wealth management and investment banking institution in the MENA region, with $4.56 billion in assets under management as of September.
