Saudi Fransi Capital’s head of investment banking, Moataz Al-Anqari, said in an interview with Al-Arabiya, that there is more than one factor to the high levels of liquidity in the Saudi stock market during 2021 and the increasing pace of initial offerings.
Al-Anqari said average daily trading during the year 2021 was 8.8 billion riyals, up from 3.36 billion riyals per day in 2019.
He pointed out that the broad coverage of initial offerings in the market reflects investor confidence in the Kingdom’s economic growth, as well as confidence in companies in particularly, especially after overcoming the economic consequences associated with the Corona pandemic.
The Head of Investment Banking highlighted the support provided by the financial market structuring, which has changed over the past 5 years to keep up with the best global markets, noting that it is one of the initiatives of the Financial Sector Development Program and one of the pillars of the Kingdom Vision 2030.
Regarding the high price of the new shares, Al-Anqari explained that this is due to the good fundamentals of the companies, the investor confidence in the future of the company and the liquidity of the market, and the willingness to invest, as well as the role of financial advisors in promoting proposals.
As for the acceleration of the pace of quotes, Al-Anqari said the good economic conditions in liquidity terms, market structure in infrastructures and general economic indicators are important factors in accelerating the new prices.
He continued: “The year 2021 saw the approval of 9 initial offers, compared to 3 in 2020 and 5 in 2019. The financial market announced that it had received 70 requests for listing in 2021 and during 12 December they were 4 of them in the main market and 8 in the parallel market were approved.
Al-Anqari said that this gives a great impetus and a strong indication that the year 2022 will be positive in the IPO market.
He revealed that it is difficult to predict who will bid in 2022, but it is certain that the proposals will be strong as long as the supporting factors are in place, such as strong economic growth and all the general positive economic data.
On the other hand, Al-Anqari said that there is a global and local trend to offer companies in rapid growth or venture capital, noting that the five largest companies in the US market specialize in technology.
He explained that Saudi Arabia is trying to catch up quickly, given that 60% of its population is under the age of 35, adding, “We have an emerging technology-interested and technology-intensive generation . As long as it is. the infrastructure will be developed in the Kingdom, it will be a cornerstone for the underwriting of corporations.
He stressed that all the ingredients for success exist for investing in technology within Saudi Arabia, between the availability of capital, the desire to invest and young generations interested in new technologies.
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