Positive expectations for IPOs in “Cooperation Countries” during the coming period

The latest report issued by PwC Middle East on initial public offerings showed an increase in IPO revenues in the Gulf Cooperation Council countries during the third quarter of 2024, despite a decrease in the number of completed operations compared to the third quarter of 2023.

Looking at the next stage, the future outlook for the IPO market in the Gulf Cooperation Council countries remains positive, with a number of companies in various sectors intending to offer their shares for an initial public offering throughout the region.

The rise in revenues came against the backdrop of the huge IPO of NMDC Energy Group on the Abu Dhabi Securities Market, which is the largest IPO in the UAE since the beginning of this year until now. The proceeds of this operation amounted to 877 million US dollars, and the number of subscribers increased significantly more than expected. While the other three IPOs carried out during the same quarter were for the Saudi parallel market, “Nomu”.

The companies that carried out their IPOs this year continued to achieve positive performance in the secondary market, as the prices of most of the shares offered in the 10 largest public offerings (according to the size of the deal) rose above the initial offering price.

Mohammed Hassan, Head of the Capital Markets Department at PwC Middle East, said: “As is the case in the past few years, the third quarter witnessed a relative decline in companies entering the market. Since the end of the third quarter, we have witnessed the completion or announcement of a number of IPOs in a number of Gulf countries, including the largest IPO in the Sultanate of Oman for OQ Exploration and Production Company, which supports positive expectations for the remainder of 2024.”

The third quarter of the year also witnessed the raising of $4.4 billion through bonds, an increase of about 30% compared to the same period in 2023. $5.2 billion was also raised through sukuks, and 88% of these sukuks were issued on the Qatar Stock Exchange or Nasdaq Dubai. It is worth noting that about 65% of these bonds and sukuks are issued by Gulf governments.