KSA capital markets to be ‘key to powering corporate investments’

KSA capital markets to be ‘key to powering corporate investments’

Saudi Arabia’s capital markets will play a key role in funding not just private sector investments but also giga-projects such as Neom, the IPO for which is expected in 2024, said S&P Global Ratings.

Government reforms and high oil prices are creating significant investment opportunities for Saudi Arabian corporates. Given the country's many government schemes, investment commitments, and private sector spending plans, its investment needs are significant. The banking sector will not be able to meet all needs despite its strong capitalisation, S&P said in an analysis.

Saudi Vision 2030's investment programme continues to drive funding requirements, while the authorities are also pushing to deepen local debt and equity markets and increase FDI. The Saudi Stock Exchange, Tadawul, is the largest equities market in Mena by market capitalisation and trading volumes.

Saudi Aramco IPO

The 2019 Saudi Aramco IPO was a major step and several Saudi entities have tapped the equities market. This year, as of November 24, 2022, 15 companies have undertaken an IPO and raised around SR26 billion ($7 billion) while 16 companies have done so on the parallel market (Nomu) raising SR11 billion ($3 billion) in addition to ETFs and CEFs.

Saudi debt markets, like others around the world, have been less