Hajj company to float in Saudi – with London listing to follow

Saleh Salem/Reuters

• First Hajj services company to list
• Preparations being made for Nomu
• Dual listing overseas anticipated

Saudi Arabia’s Ithraa Alkhair Company for Pilgrims Services, a licensed provider of Hajj services for non-Arab African pilgrims, is preparing to launch the first IPO in the kingdom’s religious tourism sector. 

The company, part of the Ithraa Group, will float an 11 percent stake to institutional investors on the Nomu parallel market, chairman Dr Ahmed Sindi told AGBI. 

The company is also considering a dual listing overseas.

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“We expect to submit our listing application within three months,” Sindi said.

“We are 100 percent ready. We expect to be the very first [Hajj services] company to be listed in the Saudi market and hopefully later on in some other markets when the regulatory regime allows it.”

Ithraa Alkhair oversees various aspects of pilgrimage trips, including accommodation, transportation and support services for pilgrims. 

Sindi said London is a preferred location for a second listing due to the significant Muslim community in the UK and growing number of UK-based Hajj visitors.

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“We hosted over 2,500 people from the UK last year,” Sindi said. “We aim to elevate this further.”

Sindi said the company has chosen not to list on the Tadawul initially, preferring to first test the waters on the Nomu market to provide comfort to shareholders. 

“Our size, the size of the transaction, the size of our profits, the size of our revenue, allows us for direct listing in Tadawul,” he said.

“But we thought, let’s be a little bit careful and see how it goes. We thought going to Nomu is an excellent first step and then we take it in steps from there on.”

Ordinary retail investors cannot trade stocks on Nomu, which is restricted to qualified individual investors and institutions.

Companies must be members of Nomu for two years before they can apply to upgrade to the main index and gain exposure to a far greater number of investors.

The Hajj services sector is expected to grow significantly as part of Saudi Arabia’s Vision 2030, which aims to improve Hajj and Umrah services and accommodate up to 30 million pilgrims annually by the end of this decade.

Religious tourism accounted for 45 percent of 14.6 million visitors during the first six months of 2023.

Sindi, who was speaking on the sidelines of the BMG Economic Forum in London this week, said he expects more companies in the Hajj services sector to go public.

“It is the next big sector,” he said. “I think they will be monitoring what we do, and walking in our footsteps.”

Fouad Bishara, board member at Hajj services provider Ashraqat Company, told the event that it has contracted Saudi-based investment banking advisory BMG Financial Group to help prepare it to become a publicly traded company. 

Nomu is poised for a further flurry of new listings this year.

In December the market regulator revealed that a further 41 companies had applied to join the market, either via direct listings or initial public offerings.