Saudi sees strong potential for IPOs in 2014
Riyadh, April 27, 2014
Saudi Arabian companies are increasing looking to raise funds via the Tadawul (Saudi Stock Exchange), creating a strong pipeline of upcoming IPOs, said senior executives ahead of a key financial summit in Riyadh.
The '9th Euromoney Saudi Arabia Conference' will be held at the Al Faisaliah Hotel in the Saudi capital from May 6 to 7. It is expected to attract around 1,200 delegates from all over the region and the world.
Senior executives from Tadawul, Manafea Holding Company, Saudi Aramco, Amundi Asset Management, and HSBC Saudi Arabia will discuss the dynamics between the development of the stock market and the needs of Saudi Arabia’s businesses at a special session on “Growing Capital Markets” on the final day of the conference.
Tadawul currently trades 161 companies, and in 2013 posted 28.97 million trades for a total value of SR1.37 trillion ($365.2 billion), according to Tadawul's 2013 annual report.
Equity valuations have improved in 2014, which – combined with rising investor demand – has the potential to encourage more companies to consider listing.
Richard Banks, the regional director of Euromoney Conferences, said: “We’re seeing positive conditions on both sides of the equation, as Tadawul continues to enhance its regulatory processes and the Kingdom’s companies look to raise funds, raising the market’s global financial standing and accelerating the pace of share sales.”
“The Euromoney Saudi Conference will be the ideal platform for retail and institutional investors to learn more about Tadawul's future from the people who are developing its vision and strategy,” he added.
Tadawul's strongest growth sectors in 2013 were domestic mid-cap, including retail (55.9 percent), real estate (42.4 percent), food and agriculture (39.5 percent), and construction (24.2 percent). Long-term, the large cap sectors like petrochemicals, telecom, and banking have higher upside.
In a recent report, Al Rajhi Capital noted that Tadawul is “ready for foreign investors,” thanks to a strong economy, robust banking system, institutions to manage foreign investment in equity markets, and a track record for managing banking liquidity.-TradeArabia News Service