Saudi Tadawul shares surge 13% on market debut

The company’s stock opened 10% above its listing price on Wednesday

Tadawul raised 3.78 billion riyals through an initial public offering that was 121 times oversubscribed. Faisal Al Nasser / Reuters

Shares of Saudi Tadawul Group, the owner and operator of the kingdom’s stock exchange, surged as high as 13 per cent above the listing price as it started trading on Wednesday.

The bourse's shares were priced at the top of the range last week, at 105 Saudi riyals ($27.99) per share. They opened at 115.4 riyals on Wednesday and rose to 119.20 riyals at 1.41pm UAE time before closing at 118 riyals at the end of the day's trading.

“The group's listing supports the commitment to best practice corporate governance within the business and the utilisation of the subsidiaries' integrated and scalable business model, to be an attractive investment destination for all investors,” said Khalid Al Hussan, chief executive of Saudi Tadawul Group.

The kingdom's Public Investment Fund owns a stake in Saudi Tadawul Group, which has four subsidiaries. These include: the Saudi Exchange, a dedicated arm running the kingdom's equity market previously known as the Saudi Stock Exchange Company; the Securities Clearing Centre Company (known as Muqassa); the Securities Depository Centre Company (Edaa); and a new subsidiary focused on applied technology services known as Wamid.

Tadawul raised 3.78 billion riyals through an initial public offering (IPO) that was 121 times oversubscribed. It sold 36 million shares representing 30 per cent of its issued share capital to institutional and individual investors.

“The listing marks a major milestone in the company’s growth story and is the natural next step as we emerge as a Saudi powerhouse with a global mindset that is able to leverage scale, innovation and execution capabilities to drive long-term value for all our stakeholders,” said Sarah Al Suhaimi, chairwoman of the company.

Tadawul is the only third regional stock exchange to publicly trade after the Dubai Financial Market and Boursa Kuwait.