The parallel market, “Nomu” in Saudi Arabia recently received the listing and trading of the shares of the International Information Systems Technology Company, after offering an 18% stake in its capital at the price of 850 riyals per share, making the “Ready” is the most expensive share of the Saudi market.
In an interview with Al-Arabiya, Faris Al-Ghannam, executive vice president of HSBC Saudi Arabia – who played the role of price stability manager for the “ready” offer – explained this high price as the company is emerging. by nature and size of its capital it is still in growth phase, so the value of the company was split in a smaller number of shares, indicating that a high share price does not necessarily mean a high valuation, because the share price reflects the company’s value divided by the number of shares.
He stressed that the “ready” offer was concentrated on small investors, allocating 20% of the offer to qualified individuals.
Al-Ghannam said the launch of “Jahez” is an important step, in how much is the first emerging e-commerce company to be launched in the Saudi market, which opens the market, in particular “Nomu”, to be a financing platform and to list more startups in the Kingdom and to invest in this type of company.
He continued: “The offer of emerging companies, in particularly those who work in e-commerce, is of a different nature. Evaluation is a challenge in this case, since how to evaluate a company that still is in an early stage and its accounting information does not reflect the inherent desirability in it.”
He added: “We have set up a team specialized in leading offerings in the kingdom, and is one of the largest team on the market, along with a team specialized in the technology sector and emerging companies. To achieve evaluation, we took two main steps: first, one studio in-depth analysis of the company to get to know its business, and second: preparing or structuring the offer method. Promptly communicate with investors to make sure they understand how to value this type of company. “
HSBC Saudi Arabia’s executive vice president indicated that when companies like Facebook and Amazon were initially introduced, their sales and returns were almost non-existent.
He continued: “The model of business ‘ready’ is still in constant development and we have studied and analyzed the volume index or total value index of goods, which includes the basket of goods that the company provides to customers and the platform commission. Total commodity value is the primary indicator used to measure the value of companies such as Deliveroo and Dordash. EBay and Amazon are also in an initial phase “.
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