- The UAE’s Parkin Company PJSC raised the highest proceeds in the region for the quarter at US$0.4b
- The KSA dominated listing activity with nine IPOs in Q1 2024
According to the EY MENA IPO Eye Q1 2024 report, IPO activity in the MENA region retained strong momentum. The quarter saw 10 IPOs in the Kingdom of Saudi Arabia (KSA) and the United Arab Emirates (UAE) with the combined proceeds of US$1.2b.
Globally, Q1 2024 witnessed a total of 287 IPOs, raising US$23.7b, a 7% increase in value year on year (YoY), as market participants navigated uncertainties stemming from recent economic fluctuations and a global election year.
An additional 25 private companies and 10 funds across various sectors intend to list on MENA exchanges in 2024. The KSA leads with 21 announced IPOs, followed by the UAE with one. Outside of GCC, Raya Information Technology in Egypt and Crédit Populaire d'Algérie in Algeria have announced their IPOs.
In terms of MENA stock exchange performance, the Egyptian Exchange (EGX30) emerged at the top with an 8% gain during Q1 2024, followed by Boursa Kuwait Premier Market with 7.5% and Dubai Financial Market (DFM) with 4.6%. At the end of the quarter, eight out of the 10 MENA IPOs had a positive return compared to their IPO price, with MBC Group achieving the highest gain of 128%.
Brad Watson, EY MENA Strategy and Transactions Leader, says:
“The first quarter of 2024 started off on a positive note with 10 IPOs concentrated in the GCC region, raising a total of US$1.2b. Saudi Arabia continued to dominate the listing activity with nine IPOs across diverse sectors, while DFM welcomed its first listing in 2024. The region has retained a robust pipeline, with several companies in GCC and North Africa having announced their intentions to list.”
Saudi Arabia continues to lead in IPO listings
The KSA was again the frontrunner in listing activity in Q1 2024. The country’s largest and the region’s second largest IPO was raised by Modern Mills Company at US$724m, accounting for 27.3% of the overall proceeds. This was followed by MBC Group with US$222m and Middle East Pharmaceutical Industries Company with US$131m. All three IPOs were listed on the Tadawul Main Market. The remaining six listings took place on the Nomu – Parallel Market with total proceeds of US$57m. The funds have been sourced from a variety of sectors, such as health care, F&B and media and entertainment.
The Kingdom also continued to lead the pipeline activity for the MENA region with several companies, such as Saudi Manpower Solutions Company (SMASCO), Miahona and Panda Retail Company, announcing their plans to list.
The UAE sees the region’s largest IPO in Q1 2024
In the UAE, Parkin Company PJSC raised the highest proceeds in the region in Q1 2024 with US$0.4b on DFM, contributing 37.2% of the total IPO value. The IPO was oversubscribed 165 times, with the highest first-day gain among the quarter’s listings at 35%. This is the third Roads and Transport Authority (RTA) asset to have listed after Salik and the Dubai Taxi Company (DTC).
The country also announced significant upcoming listings, including Spinneys, LuLu Group and Etihad Airways.
Growing prominence of ESG factors
The UAE has issued mandatory environmental, social, and governance (ESG) reporting guidelines for listed companies on Abu Dhabi Securities Exchange (ADX). The move marks a significant step toward enhancing transparency and promoting sustainable practices in the region's financial markets. In addition, Muscat Stock Exchange (MSX) introduced voluntary ESG disclosure guidelines in 2023, with mandatory sustainability reporting expected to be implemented by 2025. Meanwhile, Saudi Green Initiative, which aims to plant 10 billion trees by 2030, among other goals, demonstrates a commitment to environmental protection and a shift toward renewable energy sources. By embracing ESG reporting, GCC can unlock sustainable growth, attract responsible investments and contribute to a greener global economy.
Gregory Hughes, EY MENA IPO Leader, says:
“The start of the year has been strong with no sign of a slowdown in IPO activity. The successful listing of Parkin Company PJSC on the DFM demonstrated a continued commitment toward the Dubai government’s privatization program that involves listing state-owned companies as part of the nation’s economic diversification drive.”
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