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Saudi Arabia’s Al Moosa Health Co. had a roller-coaster debut on the Tadawul stock market on Tuesday, starting out high, then dipping to a low, before closing nearly 15% higher; a trading performance that has become almost a pattern for recent issuances in the kingdom.
The healthcare provider’s stock opened nearly 10% higher at 139.60 riyals ($37.22) following its $450 million IPO last month; the second biggest in the kingdom last year. The stock carried a final price tag of SAR 127 apiece, marketed at the top of price range as it drew a massive $46 billion worth of orders.
Al Moosa saw nearly 8 million shares traded for a value of over SAR1.1 billion. The broader Saudi market ended slightly higher.
First-day stock performances are generally strong in the GCC; but the gains are also mostly short-lived. Saudi health-care group Dr. Soliman Abdel Kader Fakeeh Hospital Co., which had its Tadawul debut in June last year, also soared 10% from the IPO price of SAR 63.30 on day one. After dipping to a low of SAR 57.40 within a week, the stock has since recovered, last closing at SAR68.30.
Over the next two days investors in Al Moosa will weigh its valuation as they decide to hold or book profit.
“On debut, most Saudi companies create a slight flurry in the market for the first 2-3 days, especially if they have a low float. However, although Al Moosa Health is more of a mid-size stock with a market cap of cSAR5.6 billion of which c30% was floated. This along with relatively higher listed valuations had an impact on the stock’s performance in the first day. A similar trend was seen at the time Fakeeh was listed,” said Nauman Khan, analyst at Riyadh-based SNB Capital.
(Reporting by Brinda Darasha; editing by Seban Scaria)
