Saudi Arabia dominated the Gulf Cooperation Council (GCC) initial public offering (IPO) market in the first quarter of 2024, experiencing a remarkable 594 percent surge compared to the previous year, as reported by Kuwait Financial Centre (Markaz).
Markaz's report outlined the dynamic landscape of IPO activities across the GCC region, revealing notable shifts and trends in investment flows. Saudi Arabia, in particular, showcased significant growth by raising $503 million from eight offerings.
Despite Saudi Arabia's strong performance, the overall GCC region experienced a downturn in IPO activity in terms of value, with total proceeds amounting to $931 million through nine offerings during the first three months of 2024, marking a 73 percent year-on-year decline. In contrast, the same period in 2023 witnessed issuers raising $3.5 billion through 12 offerings.
During the first quarter of 2024, Saudi Arabia captured 54 percent of the total proceeds in the GCC, while the UAE accounted for the remaining 46 percent, primarily driven by a single offering, which represented an 87 percent decrease compared to the previous year.
Other countries within the GCC did not observe any new listings activity during this quarter.
In terms of sectors, transportation emerged as the leading sector, buoyed by Dubai-based Parkin Co.'s IPO, which raised $429 million, constituting nearly 46 percent of the total GCC IPO proceeds during the period. Additionally, Saudi Modern Mills Co.'s listing in the food and beverage sector garnered over $314 million, contributing 34 percent to the total proceeds.
Following these sectors were IPOs from pharmaceuticals, healthcare equipment, and materials, accounting for 14 percent, 2 percent, and 1 percent, respectively.
Regarding exchanges, $445 million came from listings on Saudi Arabia's Main Market, with $57 million on the Nomu-Parallel Market. Meanwhile, the UAE markets contributed the remaining 46 percent, with $429 million listed on Dubai’s exchange, showcasing the vitality of both countries' capital markets.
Saudi Arabia is intensifying efforts to attract more offerings by implementing measures to appeal to international investors. During the Capital Market Forum in May, the CEO of the Saudi Exchange, Mohammed Al-Rumaih, highlighted a lineup of IPOs across various sectors, attributing this success to initiatives such as Market Making and Single Stock Options. With regulatory reforms and inclusion in global indices, the Kingdom is increasingly becoming a focal point for foreign investment.
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