MENA sees surge in IPOs led by Saudi Arabia

The MENA region witnessed a total of 48 IPOs during 2023, amassing $10.7 billion in proceeds, as detailed in the EY MENA IPO Eye Q4 2023 report.  
The MENA region witnessed a total of 48 IPOs during 2023, amassing $10.7 billion in proceeds, as detailed in the EY MENA IPO Eye Q4 2023 report.  
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Updated 06 February 2024
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MENA sees surge in IPOs led by Saudi Arabia

MENA sees surge in IPOs led by Saudi Arabia

RIYADH: Saudi Arabia led the Middle East and North Africa initial public offerings, with 14 out of 19 listings occurring in the fourth quarter of 2023.  

The MENA region witnessed a total of 48 IPOs during 2023, amassing $10.7 billion in proceeds, as detailed in the EY MENA IPO Eye Q4 2023 report.  

Notably, five listings, primarily within the energy and logistics sectors, accounted for 58 percent of the total MENA IPO proceeds raised throughout the year. 

In the final quarter of 2023 alone, the region saw 19 IPOs raising $4.9 billion in proceeds. Saudi Arabia’s leadership in IPO activity was particularly evident during the quarter, with ADES Holding Co. and SAL Saudi Logistics Services Co. leading the charge on the Tadawul Main Market with proceeds of $1.2 billion and $700 million, respectively.   

The Kingdom’s remaining 12 IPOs, which collectively raised $140 million, were conducted on the parallel market, Nomu, including the quarter’s only direct listing in the MENA region by Almujtama Alraida Medical Co. 

Saudi Arabia’s ADES Holding Co. led the quarter by raising the most funds, contributing 25 percent to the overall MENA region’s IPO proceeds, followed closely by UAE’s Pure Health Holding PJSC, which accounted for 20 percent. 

The quarter’s listings were predominantly in the Gulf Cooperation Council region, with Egypt being the only non-GCC country to report IPO activity over the year. 

Moreover, the diversity of Saudi Arabia’s IPO market in 2023 spanned several sectors, with energy, transportation, and healthcare leading the way.  

The first quarter of 2024 has already witnessed significant activity with two Saudi listings on Tadawul in January, MBC Group and Avalon Pharma, raising $222 million and $437 million, respectively, signaling a promising start to the year in the Kingdom’s capital markets, according to the report.

“The 2024 pipeline includes 29 companies across various sectors announcing their intention to list, with the Kingdom of Saudi Arabia and the UAE leading the way in terms of expected volumes. Outside the GCC, Egypt has four IPOs planned,” the report stated.  

Investor confidence remained robust in the region, with 11 of the 19 IPOs in Q4 2023 experiencing a first-day gain in share price.  

By the year’s end, 26 out of the 48 IPOs launched in 2023 demonstrated a positive return relative to their listing price, with Saudi Arabia’s Armah Sports Co. securing the highest gain at 72 percent. 

Last year saw a slight decline in IPO activity compared to 2022, with a 6 percent decrease in the number of IPOs and a 51 percent reduction in proceeds.  

This drop can be attributed to the high volume of IPOs in 2022, including significant listings such as Americana Restaurants International PLC, Saudi Aramco Base Oil Co., and Arabian Drilling Co. 


Saudi Arabia’s non-oil sector hits 5-month high as PMI soars to 57.2

Saudi Arabia’s non-oil sector hits 5-month high as PMI soars to 57.2
Updated 42 min 33 sec ago
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Saudi Arabia’s non-oil sector hits 5-month high as PMI soars to 57.2

Saudi Arabia’s non-oil sector hits 5-month high as PMI soars to 57.2

RIYADH: Saudi Arabia’s non-oil economy exhibited improved growth, with business activity accelerating at the fastest rate in five months, as indicated by an economic tracker.  

The Kingdom’s Purchasing Managers’ Index rose to 57.2 in February, marking a notable improvement from a two-year low in January. This uptick signals a significant improvement in the operating conditions of the non-oil private sector, according to the Riyad Bank Saudi Arabia PMI report by S&P Global.  

The firm’s chief economist Naif Al-Ghaith attributed the rebound of the PMI in February to robust growth in output and new orders, particularly driven by the services and construction sectors.  

“The upturn reflected the continued thriving of non-oil activities in the Kingdom which recorded a 4.6 percent increase according to GASTAT (General Authority for Statistics) flash estimates. The survey results also signalled expectations of a modest recovery in demand this year driven by the acceleration of Vision 2030 projects,” he added.  

The report also noted that this reading is the highest since September 2023, attributed to an improvement in client demand and indications of increased tourism activity.  

New export orders also exhibited a modest rebound, a trend credited by Al-Ghaith to the rising demand for domestic products in international markets and the high competitiveness of local industries. This suggests potential expansion in production and employment opportunities, according to the economist. 

While new work inflows accelerated compared to January, with reports indicating stronger market conditions and an increase in new clients, some firms mentioned that heightened competition had a dampening effect on sales growth. 

The report also highlighted a surge in employment, growing at the fastest pace in eight years, which led companies to make a solid cut to their outstanding work. 

This growth is attributed to the increase in new business and the positive outlook of firms regarding future demand. This optimism has also led firms to secure a steady flow of inputs at discounted prices from suppliers, resulting in inventory levels reaching the highest point since August 2022, as per the report. 

In terms of input price inflation, the recent survey by S&P Global indicated a slight easing in February. Costs continued to rise significantly overall, albeit at the slowest pace since July of last year. 

Selling prices rose marginally as some firms passed on higher costs to customers, while others lowered fees due to increased competition. This resulted in prices lagging behind cost increases, putting pressure on margins, the report added. 


Oil Updates – crude price extends fall as China’s economic reforms underwhelm investors

Oil Updates – crude price extends fall as China’s economic reforms underwhelm investors
Updated 05 March 2024
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Oil Updates – crude price extends fall as China’s economic reforms underwhelm investors

Oil Updates – crude price extends fall as China’s economic reforms underwhelm investors

LONDON: Oil prices fell for a second day on Tuesday as pledges by China to transform its economy amid stuttering growth since the COVID-19 pandemic failed to impress investors concerned about slower consumption, according to Reuters.

Brent futures for May fell 16 cents, or 0.2 percent, to $82.64 a barrel by 9:01 a.m. Saudi time, while US West Texas Intermediate fell 28 cents, or 0.4 percent, to $78.46. Brent was on track to fall for the fifth straight session on Tuesday.

China vowed to “transform” its economic development model and curb industrial overcapacity while setting an economic growth target for 2024 of around 5 percent, similar to last year’s goal and in line with analysts’ expectations.

That target, which would likely provide a boost for fuel consumption if achieved, will be harder to reach this year as China in 2023 benefited from the favorable base effect of a COVID-19-hit 2022, analysts said, potentially weighing on investor sentiment.

The world’s biggest crude importer also pledged to step up the exploration and development of oil and natural gas resources but at the same time vowed to tighten control over fossil fuel consumption.

While concerns over the Chinese demand outlook pressured prices lower, supply factors stemming from major producers reducing output and geopolitical worries from the Israel-Gaza war underpinned crude.

The Organization of the Petroleum Exporting Countries and its allies on Sunday extended their voluntary oil output cuts of 2.2 million barrels per day (bpd) into the second quarter to support prices amid global growth concerns and rising output outside the group.

However, US crude oil inventories are expected to have increased by about 2.6 million barrels last week, according to a preliminary Reuters poll on Monday, while distillates and gasoline stockpiles were forecast lower.

“The market has been moving higher in recent weeks amid improving fundamentals. Rising spot prices indicate the physical market has begun to tighten amid a host of other supply side disruptions,” analysts at ANZ said in a note on Monday.


Egypt begins process for privatization of airports

Egypt begins process for privatization of airports
Updated 04 March 2024
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Egypt begins process for privatization of airports

Egypt begins process for privatization of airports
  • Egypt is due to set an international tender for operating Egyptian airports, which include Cairo International Airport

RIYADH: Egypt began the executive process for offering the management and operation of Egyptian airports to the private sector, a Cabinet statement said on Monday.

Egypt is due to set an international tender for operating Egyptian airports, which include Cairo International Airport, the country’s Civil Aviation Minister Mohamed Abbas Helmy has said.

Egypt is set to transition the management and operations of critical logistics and transportation entities to the private sector, starting with the aviation industry. 

In November 2023, Egyptian Prime Minister Mostafa Madbouly declared that seaports, dry ports and airports would be offered to private sector management in the near future. 

Madbouly highlighted a strong commitment to fostering partnerships with private entities in the stewardship and operational aspects of mass transit systems.

An integrated strategy has been formulated by the Egyptian Transport Ministry, in collaboration with global corporations, to begin localization of the industry. 

In July 2023, Egypt’s efforts to bolster its private sector and empower small and medium enterprises received $533.7 million in support from the European Bank for Reconstruction and Development as it undertakes massive privatization and restructuring measures for the public sector.  

Under the umbrella of Egypt 2022-2027 strategy, launched by the Minister of International Cooperation Rania Al-Mashat in March 2022, the EBRD approved development financing worth $400 million for the National Bank of Egypt to support SMEs, focusing on regional companies led or owned by young entrepreneurs.  

The bank also approved funding worth $100 million for Banque Misr to improve financing for SMEs in a way that promotes inclusive and sustainable growth. In addition, it aims to increase funding to SMEs in areas with limited access to financial services.

The EBRD also approved another funding for the Mediterrania Capital IV Fund at a value of €30.2 million ($33.7 million).


NHC signs deals to revolutionize Saudi real estate sector with innovative technologies

NHC signs deals to revolutionize Saudi real estate sector with innovative technologies
Updated 04 March 2024
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NHC signs deals to revolutionize Saudi real estate sector with innovative technologies

NHC signs deals to revolutionize Saudi real estate sector with innovative technologies

RIYADH: Saudi Arabia’s National Housing Co. signed two agreements at LEAP 2024, aiming to support real estate activities in the Kingdom by crafting unique business intelligence solutions.

The deal were signed with data science company Quant and Paseetah Tech Solutions to empower technologies in the real estate market to enhance services provided to customers interested in making investments, the Saudi Press Agency reported.

The chief of solutions sector, Rayan Al-Aql, represented the National Housing Co. in signing the agreement, while Quant CEO Ahmed Bukhamseen and Omar Al-Omar, CEO of Paseetah Tech Solutions, represented their respective companies.

The agreements aim to enable modern technologies in the real estate sector by leveraging information owned by the NHC to contribute to creating unique solutions serving the market.

This includes generating more accurate real estate analytics, supporting innovation in data analysis, and creating real estate indicators that enhance the market’s reliance on data in property decisions. This facilitates informed decision-making for investors and buyers, the SPA reported.

NHC is showcasing its services and technological achievements at the LEAP conference currently underway in Riyadh. 

These achievements have benefited over 10 million people across eight government digital platforms. 

The company has also documented more than 9 million residential and commercial lease contracts, achieved over 6.5 million downloads for the “Sakani” application, operated and developed the “Balady” platform under the Ministry of Municipal and Rural Affairs and Housing, among other technological accomplishments associated with the digital platforms operated and developed by the NHC.

Earlier in February, the National Housing Co. announced that it would build a total of 3,800 homes after forging six partnership agreements worth SR2 billion ($533 million). 

These deals, which were signed with several real estate developers, aim to build residential units in the Riyadh southwestern community of Al-Asalah, with prices starting from SR475,000, according to the Saudi Press Agency. 

SPA added that this initiative is part of a comprehensive program of urban development spearheaded by the NHC aiming to revolutionize the housing landscape by introducing innovative concepts and integrated services, ultimately enhancing the quality of life across all sectors of society.


Saudi Arabia named ‘most improved country overall’ in US Chamber of Commerce IP Index

Saudi Arabia named ‘most improved country overall’ in US Chamber of Commerce IP Index
Updated 16 min 13 sec ago
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Saudi Arabia named ‘most improved country overall’ in US Chamber of Commerce IP Index

Saudi Arabia named ‘most improved country overall’ in US Chamber of Commerce IP Index

RIYADH: Saudi Arabia has received recognition as “the most improved country overall” in the 12th edition of the US Chamber of Commerce International Intellectual Property Index. 

Released on March 2, the report emphasizes the several achievements of the Kingdom, with Vice President of Middle East Affairs at the US Chamber of Commerce Steve Lutes telling Arab News that Saudi Arabia has made significant strides in the technology sector over the past year.

“Specifically, I think this year the Kingdom did sign on to some important international treaties and they’ve made some other progress on both the enforcement side and some other of the indicators,” Lutes said on the sidelines of the LEAP 2024 conference.

“The Kingdom moving up in ranking gives more confidence to investors,” he added. 

Lutes went on to say that the body aims to encourage partnerships with the business community, government, and academia in Saudi Arabia to drive the establishment of a diversified, knowledge-based economy aligned with Vision 2030.

The US Chamber of Commerce considers over 50 indices when ranking countries, Lutes added. 

“Some of this looks very marginal. But really, when you think about it from an economic perspective, these are very important drivers because these are the sorts of things that companies look at. Is my IP going to be safe? Is it going to be protected? Are rules going to be enforced? And that’s where you get the investment in value and innovation,” said the vice-president.

The Kingdom allocates a total of $2 million across all funding rounds dedicated to artificial intelligence companies and over $3 billion proportional to gross domestic product with a ranking position of 31 in the Global AI index.

“We’ve been looking at this as governments around the globe start to grapple with the regulatory frameworks for artificial intelligence. The Chamber commissioned a report that was largely targeted toward a domestic audience and had some policy recommendations in that,” said Lutes.

A report by the European Centre for International Political Economy and the US Chamber of Commerce, titled “The Opportunity of Artificial Intelligence: Boosting Productivity and Growth in Saudi Arabia,” will be released in March.

The study will include a breakdown covering the benefits of AI for the Kingdom, endowments and digital industry structures, and AI policies going forward. 

“It has some sector-by-sector analysis where we think it can be the most impactful. In my mind, though, the biggest message is for policymakers,” Lutes said, adding: “One of those is investing, for example, in human capital. You have to have the workforce that’s ready to take on these technologies and bring it to government processes, to business processes and see it diffuse. So, when it comes to the sectors, I think, you know, healthcare and education are two that are highlighted in particular as having the most upside.”

Lutes added this is his first time attending LEAP, which is now in its third edition, and the Chamber has been collaborating with the Ministry of Communications and the Saudi Authority for Data and Artificial Intelligence. 

“We are at the LEAP Conference and IP is so fundamental to that. So, kudos to the Kingdom this year. And I guess our message is let’s not rest on our laurels. Let’s continue to work together to see if we can continue to see the Kingdom climb in that index as well,” he concluded. 

LEAP, held in Riyadh from March 4-7, is an annual premier tech event founded in 2022 by the Ministry of Communication and Information Technology. It convenes leading professionals from the sector to deliberate on the industry’s future and the innovative opportunities ahead.