Saudi Arabia will record a resurgence in initial public offerings (IPOs), with 2025 and 2026 being heavy in terms of number of listings, Al Rajhi Capital said.

Seven IPOs have already been approved/closed, with two to be listed in January and 97 IPOs under review.
 
"If we assume 50% of the IPOs receive the Capital Market Authority (CMA) approval, we are looking at an IPO pipeline of 56 companies over the next two years," said Dr. Sultan Altowaim, Head of Research, Al Rajhi Capital.

Therefore, the next two years could easily surpass the IPOs in 2022 in terms of number of listings.

"We believe, in the absence of any major secondary offering, the market should absorb 25-30 listings in a year without any major impact on the liquidity," he said

After the slowdown in the number of IPOs in 2023, new listings reached 14 last year.

In addition, the secondary offering from Saudi Aramco in H1 2024 dominated the headlines and resulted in a total offering size of SAR 64 billion, surpassing the highs of SAR 57 billion raised in 2022, Altowaim said.

 (Editing by Seban Scaria seban.scaria@lseg.com)