Despite global listings experiencing a mild slowdown during Q3 2024, the MENA market still exhibits a strong pipeline of initial public offerings (IPOs). The sector recorded a significant year-on-year (YoY) increase in value at 76.8%, during Q3 2024.
The third quarter of the year saw five IPOs in the Kingdom of Saudi Arabia, the UAE and Egypt, with combined proceeds totalling $930 million, according to the EY MENA IPO Eye Q3 2024 report,
Moreover, an additional 11 private companies across various sectors as well as five funds intend to list on the MENA exchanges by the end of this year, the report stressed.
Notable GCC companies that have made announcements regarding their listing plans include Lulu Retail on the Abu Dhabi Securities Exchange (ADX), Talabat Middle East FZ LLC on the Dubai Financial Market (DFM) and OQ Exploration & Production LLC on the Muscat Stock Exchange (MSX).
In KSA, Tamkeen Human Resources Company, Arabian Company for Agricultural and Industrial Investments and Nice One Beauty Digital Marketing Co. have obtained approval from the Capital Market Authority (CMA) to list their shares on the Kingdom’s stock markets.
Exchanges’ performance
Looking at the performance of MENA stock exchanges the Egyptian Exchange (EGX30) retained its top position in q3 2024 with a 26.8% increase from the beginning of the year.
Meanwhile, the MSCI Emerging Markets Index closed Q3 2024 with a gain of 14.3% compared to the beginning of the year, making it the highest-performing market in the GCC. At the end of the quarter, four out of the five MENA IPOs showed a positive return compared to their IPO price.
“Despite the ongoing and challenging geopolitical environment in the MENA region, the IPO pipeline remains robust.” said Brad Watson, EY MENA Strategy and Transactions Leader. “We can expect to see a number of IPOs in the final quarter across a variety of sectors.”
Saudi Arabia leads in IPO volumes
Saudi Arabia was the MENA country to record the most IPO activity during the quarter. The Kingdom saw three IPOs achieve a total fundraise of $27million.
The highest proceeds – US$12m – belonged to Tharwah Human Resources Company, followed by ASG Plastic Factory Company with $9million and Al Ashghal Almoysra Company with US$6m. All three IPOs were listed on the Nomu – Parallel Market.
“Saudi Arabia continues to lead IPO activity in the region,” said Gregory Hughes, EY MENA IPO Leader. “The Tadawul Nomu – Parallel Market has become an attractive option, offering improved fundraising opportunities for the Kingdom’s growing SME sector. For the MENA region, it is now the stock exchange with the highest number of IPOs in 2024.”
The final quarter of the year is expected to see Al Majed for Oud Company SJSC and Arabian Mills for Food Products Company listed on the Tadawul Main Market, and First Avenue for Real Estate Development Company listed on the Nomu – Parallel Market.
