Saudi IPO market set for bumper year boosted by lockdown savings

Saudi IPO market set for bumper year boosted by lockdown savings
Total deposits at Saudi commercial banks increased, from nearly 1.8 trillion riyals ($479.88 billion) at the end of 2019 to 1.94 trillion riyals as of December last year. (File/AFP)
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Updated 10 February 2021

Saudi IPO market set for bumper year boosted by lockdown savings

Saudi IPO market set for bumper year boosted by lockdown savings
  • The kingdom generated IPO proceeds worth $1.45 billion last year despite the economic fallout from the pandemic

DUBAI: Saudi Arabia's stock market is set for another bumper year of stock market listings with several sizeable initial public offerings (IPO) in the pipeline as investors look to allocate a pile of cash built up through the coronavirus pandemic.

After the then record $29.4 billion listing of oil giant Saudi Aramco shone a spotlight on the country's equity market in late 2019, the kingdom generated IPO proceeds worth $1.45 billion last year despite the economic fallout from the pandemic.
At the same time, total deposits at Saudi commercial banks increased, from nearly 1.8 trillion riyals ($479.88 billion) at the end of 2019 to 1.94 trillion riyals as of December last year, according to central bank data.
"There is surely more liquidity in the market but that is natural after COVID as there is more disposable income to invest," said Mazen Al-Sudairi, head of research at Al-Rajhi Capital in Riyadh.
Four out of seven IPOs from Gulf countries last year launched on Saudi Arabia's Tadawul bourse, the largest market in the region with average daily turnover in excess of 8 billion riyals last year, according to data from EFG-Hermes.
The offerings of non-cyclical or defensive shares could not have been better timed, with the sectors outperforming during the pandemic.
Sulaiman Al Habib Medical Services was the largest company in the region to go public, raising $698.6 million, while supermarket chain BinDawood Holding raised $585.1 million.
Tadawul chief executive Khalid Alhussan told Reuters that many Saudi corporates needed to raise capital, while listings helped them become more transparent in their disclosure of information.
"We are seeing also a lot of IPO engagements already...so I anticipate this year to be even higher than last year,” Alhussan said.
The IPO of Alkhorayef Water and Power Technologies is currently underway, while Investcorp-backed Theeb Rent-a-Car is expected in the market by the end of the first quarter.
Meanwhile, utility developer Acwa Power is preparing a $1 billion listing and sizeable deals are expected from Solutions by STC and the specialty chemicals business of Saudi Basic Industries Corp, which is planning to raise several hundred million dollars at the end of the year or the beginning of next year.
Food delivery firm Jahez could be the first start up to list on the bourse, after announcing plans to go public in 2021, and Saudi Aramco will remain firmly on investors' radar, after crown prince Mohammed Bin Salman said there were plans to offer more shares in the company.sv


36,000 construction workers on Saudi Arabia’s Red Sea project given smart badges

36,000 construction workers on Saudi Arabia’s Red Sea project given smart badges
Updated 1 min 48 sec ago

36,000 construction workers on Saudi Arabia’s Red Sea project given smart badges

36,000 construction workers on Saudi Arabia’s Red Sea project given smart badges
  • System tracks worker and vehicle movements
  • Supports immediate security alerts to central team

RIYADH: Some 36,0000 construction workers on one of Saudi Arabia’s biggest real estate projects are to be given smart badges.
The Red Sea Development Company has awarded a contract to Machinestalk to provide smart badges and wireless tagging solutions, for its construction workforce and fleet of vehicles, according to a statement on the Saudi Press Agency.
Machinestalk will deploy a “LoRaWan” network over the project area of 3,500 square kilometers, in addition to launching an Internet of Things (IoT) platform, that will also help to track 3000 vehicles in operation on site, said CEO, John Pagano.
The smart badges will control access to areas of the sprawling site preventing unauthorized individuals and vehicles from entering.
The badges will also enable everyone to report any security or safety issues to a dedicated emergency response and security center.
The first phase of the project will see 14 luxury and hyper-luxury hotels across five islands and two inland resorts, providing more than 3,000 hotel rooms.
It will also include a new airport, a yacht marina, leisure and lifestyle facilities, as well as supporting logistics and utilities infrastructure, including 75 kilometers of new roads, according to the company’s website.
The destination is expected to be fully completed by 2030.


World food prices rise to highest level since July 2014

World food prices rise to highest level since July 2014
Updated 7 min 19 sec ago

World food prices rise to highest level since July 2014

World food prices rise to highest level since July 2014
  • UN food agency said the surge was led by jumps in sugar and vegetable oils
  • Sugar prices climbed 6.4 percent month on month amid concerns over supplies in 2020/21

ROME: World food prices rose for a ninth consecutive month in February, hitting their highest level since July 2014, led by jumps in sugar and vegetable oils, the United Nations food agency said on Thursday.
The Food and Agriculture Organization’s food price index, which measures monthly changes for a basket of cereals, oilseeds, dairy products, meat and sugar, averaged 116.0 points last month versus a slightly revised 113.2 in January.
The January figure was previously given as 113.3.
The Rome-based FAO also said in a statement that worldwide cereal harvests remained on course to hit an annual record in 2020, adding that early indications pointed to a further increase in production this year.
FAO’s cereal price index climbed 1.2 percent month on month in February. Among major coarse grains, sorghum prices increased the most, rising 17.4 percent on the month and 82.1 percent year on year, driven by strong demand from China.
Maize and rice prices edged up while wheat export prices remained largely stable, FAO said.
Sugar prices climbed 6.4 percent month on month amid concerns over supplies in 2020/21 because of production falls in major producing countries and strong demand from Asia.
The vegetable oil price index increased 6.2 percent to reach its highest level since April 2012, with palm oil prices rising for a ninth month, lifted by worries over low inventories in major exporting nations.
Dairy prices rose 1.7 percent, while the meat index posted a modest 0.6 percent gain. FAO said pig meat quotations fell, hit by reduced purchases from China amid heavy oversupply and a rise in unsold pigs in Germany due to a ban on exports to Asian markets.
FAO raised its forecast for the 2020 cereal season to 2.761 billion tons from an estimate of 2.744 billion made last month pointing to a 1.9 percent increase year on year.
That revision reflected a 7.5 million ton increase in the world wheat production estimate, driven by recently released official data from Australia, the European Union, Kazakhstan and Russia.
The forecast for global rice production was also raised by 2.6 million tons from last month on more buoyant production forecasts from India.
FAO raised its forecast for global cereal stocks ending in 2021 by 9 million tons to 811 million which would represent a 0.9 percent decline year on year.
“Looking ahead, current indications suggest a small rise in world cereal production in 2021,” FAO said.
“While most of the wheat crop in the northern hemisphere is still dormant and southern hemisphere countries are yet to plant, FAO’s preliminarily forecast for global wheat production in 2021 points to a third consecutive annual increase, to 780 million tons, a new record.”


Egypt’s ‘Scorpion King’ turns venom into money

Egypt’s ‘Scorpion King’ turns venom into money
Updated 49 min 18 sec ago

Egypt’s ‘Scorpion King’ turns venom into money

Egypt’s ‘Scorpion King’ turns venom into money
CAIRO: Surrounded by thousands of live scorpions in a laboratory deep in Egypt’s Western Desert, Ahmed Abu Al-Seoud carefully handles one of the curved-tailed arachnids before extracting a drop of its venom.
A mechanical engineer who worked in the oil sector for almost two decades, Abu Al-Seoud decided in 2018 to strike a different path — producing scorpion venom for pharmaceutical research purposes.
“I was surfing the Internet and saw scorpion venom was one of the most expensive on the market,” said the 44-year-old, clad in a white lab coat.
“So I thought to myself: Why not take advantage of this desert environment where they roam around?“
Biomedical researchers are studying the pharmaceutical properties of scorpion venom, making the rare and potent neurotoxin a highly sought-after commodity now produced in several Middle Eastern countries.
“Dozens of scorpion-derived bioactive molecules have been shown to possess promising pharmacological properties,” said a review published last May in the journal Biomedicines.
It said labs are now studying its potential anti-microbial, immuno-suppressive and anti-cancer effects, among others, hoping to one day use or synthesize them for medicines.
Abu Al-Seoud is from the Dakhla oasis, located in Egypt’s vast New Valley province and around 800 kilometers (500 miles) southwest of the capital Cairo.
Sand dunes and towering palms surround his laboratory, which he affectionately calls the “Scorpion Kingdom.”
“Here, every family has a story about a scorpion sting,” Abu Al-Seoud said.
To get the animals to secrete venom in the controlled conditions of the lab, the scorpions are given a slight electric shock.
Workers wait 20-30 days between extractions to obtain the highest quality venom.
“What matters is the level of purity,” Abu Al-Seoud said, adding that one gram requires the venom of 3,000-3,500 scorpions.
The liquid is refrigerated and transported to Cairo, where it is dried and packaged for sale as powder.
The laboratory “is certified (by the government) and has the ability to export this unique product,” said 25-year-old Nahla Abdel-Hameed, a pharmacist who works at the center.
Abdel-Hameed referred to some scientific studies that explored the healing benefits of the venom in curing certain diseases.
Mohey Hafez, a member of the pharmaceutical chamber at the Federation of Egyptian Industries, was more cautious in his assessment of its current uses.
“Scorpion and snake venoms can be used in making antisera,” he explained to AFP.
“There is no ready-made medication that entirely depends on the venom as a direct ingredient, but there has been promising research into its uses.”
New Valley province boasts around five different species of scorpions, including the sought-after deathstalker (Leiurus quinquestriatus), whose venom sells for up to $7,500 per gram, according to Abu Al-Seoud.
While he himself also catches the creatures, he employs residents of nearby villages for the risky activity, equipping them with gloves, tweezers, boots, UV lights — and antivenom.
The scorpion hunters earn one to 1.5 Egyptian pounds (around six to 10 cents) per animal.
Pharmacist Abdel-Hameed said the arachnids are caught in residential areas so as not to harm “the ecological balance.”
“I classify them according to the area where they were caught, the species and size,” she said.
Her colleague Iman Abdel-Malik said that although the scorpions could go without eating for long periods, they were given “food and protein to increase the toxin excretion” — comprised of cockroaches and worms twice a month in the summer, and less during the winter hibernation.
There are plans to breed the scorpions in the future rather than catching them, the veterinarian aged in her 20s added.
About 20,000 of the animals have been collected so far, according to business partner Alaa Sabaa, while the lab has a maximum capacity of 80,000.
He said the first scorpion venom extractions took place in December and January after two years of preparations, and yielded “three grams of venom.”
The self-financed project has so far cost about five million pounds, or around $320,000, he said, and has also attracted government support.
They also extract bee venom and sell agricultural products, including aromatic plants.
While Egypt has been producing various types of venom for years, Abu Al-Seoud said, it was often done illegally or was of poor quality.
He said he hoped his operation would one day be an antidote to the country’s “bad reputation” in the sector.
“We are trying to show off the country’s capabilities... through a high-quality product that has been studied scientifically as well as produced and exported legally,” he said.

Jadwa REIT Saudi in $85m deal for Riyadh retail, office complex

Jadwa REIT Saudi in $85m deal for Riyadh retail, office complex
Updated 04 March 2021

Jadwa REIT Saudi in $85m deal for Riyadh retail, office complex

Jadwa REIT Saudi in $85m deal for Riyadh retail, office complex
  • Property is located in Riyadh on Prince Turki bin Abdul Aziz Al-Awwal Road in the capital’s northern Hittin district

RIYADH: Jadwa REIT Saudi Fund, a Shariah-compliant real estate investment fund, has signed an agreement to purchase Boulevard Riyadh for SR320 million ($85 million).

Fund manager, Jadwa Investment, announced the deal in a bourse filing on Thursday.

Boulevard Riyadh is a retail and office complex covering 18,854 square meters and with a built-up-area of 36,340 square meters. The development is leased to multiple tenants and has an occupancy rate of 97 percent, with net operating income of approximately SR29.3 million.

The property is located in Riyadh on Prince Turki bin Abdul Aziz Al-Awwal Road in the capital’s northern Hittin district, an area known as Riyadh Boulevard.

According to the statement, the deal was subject to legal due diligence and other regulatory approvals within 180 days from the agreement date.

The transaction is expected to have a positive impact on the fund’s financial performance in the first half of this year, the filing said.

In its latest financial results, Jadwa REIT Saudi Fund posted a net profit of SR35.67 million for the first half of 2020, compared to SR37.23 million for the same period in 2019, according to data from Argaam.

The decline in net profit was mainly attributed to higher financing charges, management and custody fees, and other expenses, in addition to depreciation of operating investments.


US-based kids gym targets Arab world child obesity with fitness franchise

US-based kids gym targets Arab world child obesity with fitness franchise
Updated 04 March 2021

US-based kids gym targets Arab world child obesity with fitness franchise

US-based kids gym targets Arab world child obesity with fitness franchise
  • Childhood obesity in Middle East among world's highest
  • First gym opening planned for Doha this summer

DUBAI: US-based Tumbles’ kids gym’ plans to tackle child obesity in the Middle East with the opening of its first fitness franchise in Qatar.
The Houston-based outfit combines gymnastics and exercise with STEM subjects such as science and technology and plans to open its first regional franchise in Qatar this summer.
The new facility will be located in the City Center Mall in Doha.
“There’s a lack of companies focused on wellness for kids going into the GCC,” said CEO, Manish Vakil. “We want to be part of the solution in the region and saying these areas should not be neglected. There are a lot of dollars and investments being made in these countries but not enough specifically in children’s health.”
Gulf states have some of the highest rates of child obesity in the world and governments are increasingly taking steps to improve the fitness of young people by such measures as applying higher taxes to sugar-based drinks and focing fast food chains to display the calories contained in the food they sell.