The first quarter of 2023 witnessed a thriving IPO market in the Gulf Cooperation Council (GCC) countries, driven by various initiatives to stimulate IPO activities. Governments in the region, including Dubai, have launched strategic agendas to capitalize on the favourable economic landscape, leading to a surge in capital-raising activities. Despite global IPO trends facing challenges, the Middle East demonstrated resilience and maintained strong momentum in the IPO market.
In Q1 2023, the UAE showcased its strong position in the IPO market, with two IPOs on the Abu Dhabi stock exchange (ADX) raising a total of $3B. The highlight of the quarter was the IPO of ADNOC Gas PLC on ADX, generating $2.5B and becoming the largest IPO within the GCC and globally. The offering was 50 times oversubscribed, reflecting the immense demand from investors. ADNOC Gas PLC marked the third subsidiary listing by the ADNOC Group, showcasing the company’s commitment to diversification and capital market engagement. Additionally, Al Ansari Exchange completed its IPO on the Dubai Financial Market (DFM) in April 2023.
Saudi Arabia witnessed six IPOs on the Tadawul Nomu in Q1 2023, with a total of $71M raised. Leen Alkhair Trading Co. and Noforth Food Products Co. were the largest listings on Tadawul Nomu during this period. Despite a decrease in IPO activity compared to Q4 2022, the IPO pipeline for Saudi Arabia remains robust, with at least five IPOs reported to be underway for Q2 2023. This indicates continued investor confidence and a positive outlook for the Saudi Arabian IPO market.
The Sultanate of Oman witnessed the successful IPO of Abraj Energy Services on the Muscat Stock Exchange (MSX), generating $244M in proceeds. With an oversubscription of 8.7 times, the IPO showcased strong investor interest and confidence in Oman’s largest oilfield services provider. The listing of Abraj Energy Services is part of the Oman Investment Authority’s initiative to encourage IPO activities by privatizing government investments. MSX also hosted the private placement of Oman Qatar Insurance Company during the quarter.
The Qatar Stock Exchange (QSE) did not see any IPOs in Q1 2023 but hosted the direct listing of Beema and Dukhan Bank. Although the overall IPO activity in the Middle East and North Africa (MENA) region experienced a decline in volume and value compared to Q1 2022, the region still managed to raise $3.4B from 10 IPOs, representing approximately 16% of the global IPO proceeds for the quarter.
Recent research has revealed that the UAE stock markets emerged as the second-best performing stock market in 2022, surpassing other global markets with an impressive gain of 37 percent in US dollar terms.
This remarkable performance has captured the attention of investors worldwide, and it is expected that the interest in the UAE’s equities will persist throughout this year. The country’s capital market, More initial public offerings (IPOs) are scheduled to take place in the UAE in the coming months, further fueling excitement and opportunities for investors eager to participate in the country’s dynamic economic growth.
Despite global economic uncertainties and challenges, the IPO market in the Middle East displayed resilience and maintained strong momentum in Q1 2023. The UAE, Saudi Arabia, Oman, and Qatar witnessed notable listings, attracting substantial investments and reflecting the confidence of investors in the region’s potential. The IPO pipeline for the coming quarters remains positive, driven by various initiatives and government support. As the Middle East continues to navigate through evolving global dynamics, its capital markets are poised for further growth and opportunities in the IPO landscape.
