Investor optimism and improved regulatory frameworks are set to drive Saudi Arabia’s IPO market in 2025, according to industry experts.
January saw two significant IPOs in the kingdom, with Almoosa Health and Nice One experiencing substantial trading gains. Nice One, considered Saudi’s first unicorn, exemplifies the rising investor appetite.
Zaid Ghoul from SNB Capital highlighted Nice One’s performance as a positive sign for future IPOs. SNB Capital played a key role in managing the Nice One IPO, which raised SAR 1.2 billion at SAR 35 per share.
Ghoul anticipates a strong pipeline of IPOs, supported by favorable equity markets and liquidity on TASI and Nomu. If market conditions remain favorable, numerous IPOs are expected in 2025.
The Capital Market Authority has approved a diverse IPO pipeline for 2025, including companies like United Carton Industries and Ejada Systems. Additionally, entities like Tabby and SAMACO Motors are potential candidates.
Al Rajhi Capital predicts 50 to 60 IPOs in the next two years, with seven already approved. In 2024, Saudi Arabia led Middle East IPO activity, surpassing its GCC peers with over 50 listings.
Vijay Valecha from Century Financial notes the expansion of Saudi IPOs beyond traditional oil-based companies to sectors like healthcare and banking. The Nomu platform is also seeing more listings from smaller companies, indicating diversified investment opportunities.
The IPO sizes are increasing, with Al Rajhi Capital estimating upcoming IPOs in Q1 2025 could range from SAR 8 to 11 billion. This growth offers financial benefits and enhances international trading ties, according to James Dervin from Alvarez & Marsal.
Saudi Arabia recently raised $12 billion through a bond sale, aimed at addressing a fiscal deficit and reducing debt. This move aligns with the kingdom’s broader strategy to attract foreign direct investment, targeting $100 billion by 2030.
The kingdom is also easing investment rules for foreign investors, enhancing access to securities on the main market. Since its reclassification to emerging-market status in 2018, Saudi Arabia has attracted significant institutional capital inflows.