https://arab.news/jcn5z
- As many as 62 companies applied for offering applications on the parallel market during the first quarter, out of which six were approved
RIYADH: Saudi Arabia’s parallel market's Nomu capped index took investors by surprise as its market value grew at a faster rate than the main market's TASI during the first quarter of 2022.
Nomu’s market capitalization rose 209 percent on the year to SR38.5 billion ($10.3 billion) from SR12.5 billion in the year-ago period, according to statistics by the Capital Market Authority.
However, the market cap of the main market, which captures the performance of 215 firms listed on the Saudi exchange, increased at a slower rate of 24 percent to SR11.96 trillion.
The parallel market exited the quarter at 25,010 points, with the total value of shares traded surging 162 percent year-on-year to SR7.11 billion, while the main market saw a drop of 22 percent.
The value of shares traded on the parallel market stood at SR3.8 billion in the fourth quarter of 2021 and SR2.7 billion in the first quarter of the same year.
It is worth mentioning that the fear of a global economic slowdown weighed on the parallel market index in May, dragging it down to 22,402 points at the closing bell on May 29.
Nomu has also attracted companies seeking to sell shares to the public with lighter listing regulations, leading to a significant increase in listings over the past two years.
The number of publicly listed companies on the parallel market reached 25 by the end of the first quarter this year, against only four listings in the fourth quarter of 2020.
In the first quarter alone, Nomu recorded seven IPOs raising $608 million in addition to four direct listings, thanks to strong interest in the oil-rich nation’s capital market.
Food delivery platform Jahez International Co.’s listing in January was the first-ever of a local technology startup on Nomu, after generating $428 million in proceeds.
As many as 62 companies applied for offering applications on the parallel market during the first quarter, out of which six were approved.
This is down slightly on a sequential basis from a record 71 filings in the fourth quarter of 2021.
Nomu offers a huge prospect for growth to smaller companies that wish to go public.
They can later shift to the main market when ready to bear bigger loads in terms of data disclosure and governance.
Most recently, Arab News reported that Nomu-listed developer Somou Real Estate Co. is planning a transfer to the main TASI index.
The transition is subject to approval from the Saudi stock exchange as well as fulfilling all requirements imposed by the market.