The Tadawul readies for public trading

April 24, 2014 2:50 pm

The Tadawul, otherwise known as the Saudi Stock Exchange, is ready for companies to go public, according to senior executives speaking at the ninth Euromoney Saudi Arabia Conference. Numerous companies in the region have been collecting investments in order to trade publicly and the Tadawul is ready for the upcoming storm of initial public offerings (IPOs).

As it stands, the Saudi Stock Exchange currently trades a total of 161 companies and according to the Tadawul’s annual report, posted 28.97 million trades equivalent to SAR1.37 trillion in 2013.

It also reported that the most prominent growth in 2013 was in industries such as retail (55.9 per cent), real estate (42.4 per cent), food and agriculture (39.5 per cent) and construction (24.2 per cent).

Richard Banks, the regional director for Euromoney Conferences, says: “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.”

In addition to the promising signs shown in the Tadawul’s figures, a report recently published by Al Rajhi Capital noted that the Saudi Stock Exchange is ready for an influx of investments, both domestic and foreign. The report attributes Saudi Arabia’s readiness to the stability of the nation’s economy, its durable banking network, its capability to successfully handle foreign investments and a good record of managing liquid assets.

Finally, improvements in equity valuations, in the year thus far, are ample reason for Saudi companies to line up for their IPOs.