Analysis Markets Healthcare sector props up Gulf IPOs in 2024 By Megha Merani July 16, 2024, 10:55 AM Alamy via Reuters Three Gulf region healthcare sector IPOs in the first half of 2024 were worth a combined $788 million Saudi Arabia leads region with 19 Healthcare represents 22% of proceeds 32% year-on-year drop in value The healthcare sector has emerged as a significant contributor of initial public offerings in the Gulf region during the first half of 2024, according to a report by the Kuwait Financial Centre, known as Markaz. This comes despite an overall decline in new listings. However, Saudi Arabia’s Al-Hokail Academy Specialized Digital Polyclinics Company cancelled its plans to launch an IPO on the Parallel Market (Nomu) of the Saudi stock exchange. Al-Hokail said it plans to return to the market at a later stage. NewsletterGet the Best of AGBI delivered straight to your inbox every week Saudi Arabia led the region in IPO proceeds in the first six months of 2024, raising $2.1 billion from 19 offerings, which accounted for about 60 percent of the total GCC IPO proceeds. The healthcare sector was a major contributor, with three offerings totalling $788 million, representing nearly 22 percent of the total proceeds. The standout was the IPO of Fakeeh Care Group, which alone raised $764 million. Experts told AGBI earlier this month that the region’s affordable healthcare market is ripe for investment as patients are forced to travel to India, Thailand or Egypt to find cheap treatment. Demand for complex treatments, an ageing population, high dependence on imports and a lack of specialised treatment centres are all pushing up the cost of healthcare. Gulf IPOs: what companies must do to go public Saudi Arabia’s PIF hires banks for Nupco’s $1bn IPO Frank Kane: Spinneys IPO – like selling one-dirham steaks Alpen Capital of Dubai predicts that healthcare expenditure will reach $135.5 billion a year in 2027. There was also significant activity in the technology sector, raising over $515 million through the IPO of Alef Education, which constituted 14 percent of the total GCC IPO proceeds for the period. In total, the GCC raised $3.6 billion through 23 IPOs in the first six months of 2024, marking a 32 percent decline in value compared to the same period in 2023, when $5.3 billion was raised through 21 offerings. Saudi Arabia dominated the IPO landscape with a 141 percent increase in IPO value year on year. The UAE followed, raising $1.3 billion from three offerings, which accounted for 37 percent of the total GCC IPO proceeds but marked a 67 percent decline compared to the previous year. IPO proceeds in Kuwait reached $147 million from a single offering, representing 4 percent of the regional total. The industrial, consumer staples and food and beverage sectors also made notable contributions, accounting for 12 percent, 11 percent, and 9 percent of the total proceeds, respectively. The commercial and professional services and insurance sectors contributed 8 percent and 6 percent. Saudi Arabia’s Tadawul market was the leading exchange, recording 59 percent of total IPO proceeds, with $1.95 billion listed on its main market and $143 million on the Nomu-Parallel Market. The Dubai Financial Market (DFM) hosted $805 million in IPOs, constituting 23 percent of the total GCC proceeds, while the Abu Dhabi Securities Exchange (ADX) saw $515 million, accounting for 14 percent. Boursa Kuwait recorded $147 million in proceeds. The top five IPOs in the GCC for the first half of 2024 Fakeeh Care Group: Raised $764 million by offering 49.8 million shares, covered 119 times Alef Education: Raised $515 million by offering 1.4 billion shares, covered 39 times Parkin Company: Raised $429 million by offering 750 million shares, covered 165 times Spinneys Company: Raised $375 million by offering 900 million shares, covered 64 times Modern Mills Company: Raised $314 million by offering 24.5 million shares, covered 127 times