By Flynas has formally declared its intention to initiate its initial public offering (IPO) on the Tadawul stock exchange within the current year. This strategic decision is in alignment with the overarching objectives of the kingdom to fortify its aviation sector and capitalize on the surge of initial public offerings observed domestically.
The confirmation of Flynas‘ IPO plans transpired during the Airline Economics conference held in Riyadh, where the airline’s chief executive, Bander Al Mohanna, unveiled the company’s robust financial performance. Flynas disclosed a notable 32 per cent annual revenue increase, reaching 6.3 billion Saudi riyals ($1.68 billion) in 2023. This substantial growth underscores the airline’s resilience and market potential.
Established in 2007, Flynas has consistently delivered profits since 2015, with the exception of the pandemic-induced downturn. Supported by billionaire businessman Prince Alwaleed bin Talal, the airline has entrenched its position in the industry. Operating as an all-Airbus carrier, Flynas maintains a fleet of 64 aircraft and serves over 70 domestic and international destinations.
In addition to the IPO plans, Flynas has initiated a request for proposals to procure 30 wide-body aircraft, signaling its commitment to expansion and modernization. This strategic initiative harmonizes with Saudi Arabia’s broader vision for the aviation sector, aimed at attracting $100 billion in investments across airports, airlines, and aviation support services by 2030.
Saudi Arabia‘s aviation aspirations extend beyond Flynas, with the imminent commencement of operations for Riyadh Air in the upcoming year. The kingdom’s comprehensive strategy aims to bolster air connectivity, accommodate a burgeoning passenger base, and stimulate cargo capacity growth over the ensuing decade.
The upsurge in IPO activity within Saudi Arabia mirrors escalating investor confidence and interest in the market. Notably, the preceding year witnessed a record number of IPOs, with companies raising $3.5 billion through 35 offerings on the Saudi exchange. This momentum is anticipated to persist in 2024, with numerous entities contemplating listings on Tadawul’s Main Market and Nomu-Parallel trading platform.
Mohammed El Kuwaiz, chairman of the kingdom’s Capital Markets Authority, underscored Saudi Arabia’s transition from a net capital exporter to importer, reflecting the evolving economic landscape. The ongoing IPO momentum underscores a promising trajectory for Saudi Arabia’s capital markets, highlighting its appeal to both domestic and international investors.
As Flynas prepares to embark on its IPO journey, Saudi Arabia’s aviation sector stands poised for further expansion and transformation, buoyed by strategic investments and evolving market dynamics on both domestic and global fronts.
