Capital Markets
From The Report: Saudi Arabia 2023
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Saudi Arabia boasts the MENA region’s largest and most liquid stock market, with a capitalisation of approximately $2.7trn. It is an appealing destination for international investment, advancing the Financial Sector Development Programme to diversify the economy beyond hydrocarbons in line with Vision 2030. The programme supports regulatory reforms and the rapid growth of local markets, while aiming to elevate the Saudi Exchange on the global stage. A robust initial public offering pipeline, led by increased merger and acquisition activity, reinforces the attractiveness of Saudi capital markets. Although challenges regarding secondary market trading and innovative equity trading options remain, the macroeconomic environment remains stable and the Saudi Exchange is expected to maintain its leading position in the region.

This chapter contains interviews with Mohammed Al Rumaih, CEO, Saudi Exchange; and Faris AlGhannam, CEO and Board Member, HSBC Saudi Arabia.

Articles from this Chapter

Overview

Open call: The authorities are working to retain and enhance the Kingdom’s status as a regional and global financial centre
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Saudi Arabia has the largest and most liquid stock market in the MENA region. With a market capitalisation of about $2.9bn as of July 2023, Saudi Arabia is considered an attractive destination for international investment. The Kingdom is advancing a comprehensive Financial Sector Development Programme (FSDP) to diversify the economy away from reliance on hydrocarbons in line with the long-term socio-economic development plan Vision 2030. The FSDP aims to broaden and deepen the capital markets in…

Interview

Local potential: Mohammed Al Rumaih, CEO, Saudi Exchange, on promoting diversification efforts and the strength of domestic markets
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Interview:Mohammed Al Rumaih What does the initial public offering (IPO) pipeline signal about the potential of local capital markets? MOHAMMEDAL RUMAIH: The continued strength of Saudi Arabia’s IPO pipeline – at a time when global markets have seen a slowdown in IPO activity – is an indicator of the market’s resilience and its continued growth potential, which generates interest among domestic and international investors. The year 2022 saw 17 listings on the main market and 32…

Analysis

On the up: The macroeconomic climate is set to boost public offerings
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The GCC saw a rise in initial public offerings (IPOs) in 2022 despite volatility in secondary markets, surpassing the previous year’s record high. The total number of IPOs in the region increased from 20 in 2021 to 48 in 2022, marking a 140% rise, and proceeds from GCC issuers increased by 211% from $7.5bn to almost $23bn over the same period. The growing number of successful IPOs in the region has resulted in greater interest from investors. Following an uptick in activity in the UAE and Saudi…

Interview

Attractive prospects: Faris AlGhannam, CEO and Board Member, HSBC Saudi Arabia, on investment opportunities for local and global players
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Interview:Faris AlGhannam Where do you identify opportunities to enhance and expedite the listing process? FARISALGHANNAM: The country’s economic performance in 2022 validated and reflected significant progress in the implementation of the Vision 2030 development plan. The reforms and programmes associated with the blueprint contributed to the strong interest seen in primary markets in the Kingdom that year, particularly in terms of initial public offerings (IPOs). A good example…

Analysis

Greener pastures: The potential for environmental, social and governance to support the energy transition and disaster-relief efforts
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Amid significant headwinds in 2022, environmental, social and governance (ESG) funds saw their first net outflow since 2011. However, the energy transition, climate-related threats to food security and the search for long-term value could prompt a resurgence of sustainable investment in emerging markets. Global ESG funds enjoyed a record run from 2019 to 2021, growing by 98% and seeing net inflows of $25bn in 2020 and $35bn in 2021 net outflows from ESG funds in 2022 tallied $13.2bn by November.…