Riyadh — Most new listings surged on Saudi Arabia’s secondary market as that bourse, which has less onerous listing requirements than the main stock market, opened its doors for the first time on Sunday.
In the new Saudi Parallel Market, where seven stocks started trading, retailer Abdullah Saad Mohammed Abo Moati Stationaries rose 6.7 percent from its initial public offer price in volume of a little over 1 million shares.
Raydan Cuisines climbed 6.3 percent and Al-Omran Industrial and Trading Co jumped 11 percent.
The new market, called Nomu, is designed to boost the role of small and medium firms, the bourse said.
The new market “is an alternative trading platform with lighter listing requirements compared to the main market,” the Saudi Stock Exchange, Tadawul, said on its website.
Nomu requires firms to have a market value of at least SR10 million, a minimum of 35-50 shareholders, and at least 20% of shares publicly owned.
The second market opens new investment possibilities for listed companies in terms of diversifying funding resources to further increase growth and business development, said Minister of Commerce and Investment Majed Al-Qasabi on his Twitter account after the parallel market started trading.
Firms listing on the main market must have a minimum capitalization of SR100 or 10 times that of the new platform.
Under the Kingdom’s wide-ranging Vision 2030 plan to diversify the oil-dependent economy, small and medium sized firms are to contribute 35% of gross domestic product, up from 20%.
The Tadawul All-Shares Index, which has a capitalization of about $400 billion opened to direct investment by qualified foreigners for the first time in 2015.
Under Vision 2030, the Kingdom plans to float less than 5% of state oil company Saudi Aramco on stock markets, in the world’s largest initial public offering.
