Saudi Arabia leads 106% rise in MENA IPO proceeds across Q1: EY

07/05/2025 00:34 AST

Proceeds from initial public offerings across the Middle East and North Africa saw a 106 percent annual rise in the first quarter of 2025, fueled by Saudi Arabia, according to an analysis.

In its latest report, professional services networking firm EY said the MENA region raised $2.1 billion through 14 IPOs - a year-on-year rise of four - in the three months to the end of March.

Over the period, 12 of the 14 listings happened in the Kingdom, with five IPOs taking place on the Tadawul benchmark index, and seven occurring on Saudi Arabia's parallel market, Nomu.

In recent years, the Kingdom has emerged as a hotspot for listings, fueled by robust economic reforms, diversification efforts away from oil dependence, and growing interest from regional and international investors.

In January, a separate report released by Kamco Invest said that Saudi Arabia led the GCC IPO market in 2024, earning a global ranking of seventh in total IPO proceeds.

Commenting on activities in the first quarter, Brad Watson, MENA EY-Parthenon leader, said: "This year started on a positive note. MENA capital markets continue to show resilience, with the total IPO value more than doubling compared to the same period last year."

He added: "Saudi Arabia continues to dominate the MENA region's market in terms of activity as well as proceeds. In addition, the IPO pipeline for the rest of the year remains robust across various sectors and multiple countries."

According to the latest report, the Kingdom's Tadawul main market welcomed the largest offering in the MENA region during the first quarter of this year, with Umm Al Qura for Development and Construction Co. raising $523 million, contributing to 22 percent of the overall IPO proceeds.

This was followed by Almoosa Health Group, which accounted for 19 percent with $450 million, and Derayah Financial with $400 million.

Overall, the Tadawul main market generated $1.8 billion in total proceeds, while Nomu raised $69 million.

EY revealed that 28 percent of the IPO funds raised in Saudi Arabia came from the real estate management sector, followed by healthcare equipment and services at 24 percent, financial services at 21 percent, and consumer discretionary and retail at 17 percent.

In the first quarter of this year, the UAE witnessed one IPO on the Abu Dhabi Securities Exchange, with Alpha Data PJSC raising $163 million.

Oman's Muscat Stock Exchange saw one IPO, with Asyad Shipping Co. raising $333 million.

"The increased demand for MENA listings has led to developments in market infrastructure through new products, enhanced governance standards, and a focus on transparency and accountability," said EY MENA IPO and Transaction Diligence Leader, Gregory Hughes.

He added: "The upward trajectory in the number of IPOs across the region reflects a wider trend of sector diversification, with investors and companies increasingly looking beyond traditional oil-based industries."

EY further said that the outlook for MENA IPOs for the rest of 2025 remains positive, with 21 companies intending to list on the region's exchanges across various sectors.

According to EY, Saudi Arabia remains the frontrunner in this pipeline, with 17 companies already receiving approval from the Kingdom's Capital Markets Authority.

In the UAE, three companies have announced their plans to list, and outside the GCC, Egypt has announced one IPO.

"In 2025, we can potentially expect to see an increase in IPOs from the technology sector, including online retail, fintech, foodtech, and classifieds," said Hughes.