Markets

Kuwaiti companies looking at Saudi exchange listings

November 1, 2024, 3:12 PM

A Saudi man walks at the Tadawul Saudi Stock Exchange, in Riyadh, Saudi Arabia — Strategic ties between Kuwait and Saudi Arabia are deepening, with Kuwaiti firms looking at potential listings on the Tadawul exchange as soon as next year

Collaboration deals
Increased trade volume
2025 listings potential

Kuwaiti companies are eyeing up opportunities to list on Saudi Arabia’s Tadawul exchange, according to reports.

It comes almost two years since deals were signed between market regulators in both Gulf states to explore collaboration around cross-listings on the Tadawul and Kuwait’s bourse.

Firas Al-Salem, chairman of the Kuwaiti Business Council, said that listings could start next year, Asharq News reported.

At the end of 2023 there were 149 companies listed on the Boursa Kuwait and 232 on Saudi Arabia’s Tadawul, although the latter has increased significantly following a rush of flotations in the kingdom this year.

This is reflected in the latest financial results. Saudi Tadawul Group Holding Company recorded net profits after Zakat of SAR506 million ($135 million) in the first nine months of this year, up almost 70 percent year on year.

Saudi Arabia has led IPO activity this year, largely due to Saudi Aramco’s $11.2 billion secondary offering in July.

Several companies have announced plans to list on the Tadawul, including perfumer Al Majed for Oud Co and Arabian Company for Agricultural and Industrial Investment (Entaj), a Riyadh-based poultry producer.

The Tadawul is included in the MSCI, FTSE Russell and S&P Emerging Market indices. Since April 2022 the kingdom has been added to the FTSE Russell Emerging Markets Government Bond Index.

It has also been a good year for Boursa Kuwait, which announced a 14.5 percent increase in net profit for the nine months ended September 30 to KD14 million ($46 million).

Al-Salem added that Kuwait’s two largest banks plan to expand in Saudi Arabia, to capitalise on the financing opportunities provided by the giga-projects initiated through the kingdom’s Vision 2030 programme.

Trade volume between the two countries reached approximately SAR11 billion in 2022 and amounted to more than SAR6 billion until July 2023, the state-controlled Saudi Press Agency reported in January this year.

In June Kuwait’s sovereign wealth fund, which manages more than $800 billion in government funds, announced plans to open an office in Saudi Arabia. A month earlier the two countries approved a feasibility study to investigate building a rail link between Kuwait City and Riyadh.

Saudi minister of transport and logistic services Saleh bin Nasser Al-Jasser said the announcement was “an important step on the road to enhanced strategic cooperation between the two countries”.