Gulf initial public offerings raised a combined $12.1 billion in 2024 as companies across myriad sectors including retail, healthcare, energy and financial services went public, deepening and broadening the region’s stock markets.
High subscription levels for this year’s diverse listings demonstrate strong investor interest in gaining exposure to the Gulf’s oil and non-oil economies.
There were 48 IPOs in the GCC countries this year: 38 in Saudi Arabia, seven in the UAE, two in Oman and one in Kuwait according to data from London Stock Exchange (LSEG). Combined, these flotations raised $12.06bn.
“There has been a robust delivery of Gulf IPOs this year and I’d expect a similar amount to be raised next year,” said Tarek Fadlallah, CEO of Nomura Asset Management Middle East in Dubai.
Of the 21 Gulf IPOs that raised at least $100 million, three were by companies in the oil and gas sector, four were retailers, three were in the food and beverage industry and four were in professional or financial services, LSEG data shows.
Gulf IPOs usually range from $250m to $750m, although there are several each year that exceed this. Six of the 10 largest Gulf IPOs of 2024 were in the UAE, two were in Saudi Arabia and two in Oman.
Abu Dhabi-headquartered, Dubai-listed Talabat completed the Gulf’s biggest IPO for the year in November selling 20pc of its stock for $2.03bn. Shares in the food delivery company, a subsidiary of Germany’s Delivery Hero, were down 10.6pc on their IPO price to Friday’s close.
The next biggest IPO was that of OQ Exploration and Production, a subsidiary of Oman’s state oil company, OQ which sold a 25pc stake to investors for $1.95bn. Abu Dhabi retailer LuLu Retail Holdings was third, raising $1.72bn.
The region’s biggest flotations usually involve the sale of small stakes in large government-owned companies. Yet two of the three largest of 2024 – Talabat and LuLu — are privately run companies.
“A concern a year ago was that governments were being too aggressive, with too many large companies being brought to the market at the same time,” said Akber Khan, acting chief executive of Al Rayan Investment in Doha.
The relative lack of IPOs by government-related entities this year indicates policymakers have heeded these worries despite a public sector imperative to float stakes and reduce involvement in the countries’ free market economies.
In the private sector, deregulation and economic diversification is enabling companies in various industries including leisure, healthcare, education, retail, e-commerce and transport “to come to the market with fresh ideas for investors”, said Fadlallah. Finally, there is ample investor liquidity and enthusiasm for new company listings.
“These storylines seem unchanged going into next year,” added Fadlallah.
“It’s sustainable because there’s a strong pipeline of companies waiting to go public and because the quantum of money being raised is not staggeringly large. It’s significant, but it’s not overwhelming.”
Saudi Arabia’s largest IPO was that of Dr Soliman Abdulkader Fakeeh Hospital, which sold $764m of its shares. Modern Mills was the kingdom’s second biggest, raising $314m.
Of Saudi Arabia’s 38 IPOs, 27 were by companies that subsequently listed on Nomu, Riyadh’s secondary market for smaller businesses.
Nomu’s biggest IPO was Fourth Milling’s $229m flotation. The remaining 26 raised $277m combined, LSEG data shows.
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