Almoosa Health just pulled off a 21% first-day pop in Riyadh after raising $450 million in its IPO, swerving away from a recent trend of dull regional listings.
The offering saw a deluge of investor interest, with a mammoth $46 billion in orders. If you’re keeping score, that’s oversubscription on a level that would make Wall Street or Dalal Street blush.
The listing gains seen for Almoosa tell you that there is still demand for niche offerings in the GCC, Junaid Ansari, head of investment strategy and research at Kamco Invest, tells MONIIFY.
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Strong fundamentals
Although the offering demanded a premium in terms of 2023 P/E, Ansari says that investors are eyeing a significant jump in revenue for Almoosa, which should drive the healthcare firm’s valuation in the future.
Almoosa’s revenue grew at 18.1% between 2021 and 2023, thanks to what it claims were strong fundamentals, growth in patient volumes, and higher revenue per patient.
It recorded revenue of 979 million riyals ($261 million) for the financial year ending in December 2023, and 870 million riyals in the first nine months of 2024.
The company, which offers 730 beds across two hospitals in Saudi Arabia’s Eastern Province, plans to open five standalone primary healthcare centers by 2027, and another two hospitals by 2028, which will add 700 beds to its offering.
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Still going strong
ICYMI, this isn’t the first healthcare IPO in Saudi Arabia to crush it. Fakeeh Group’s $763 million IPO last year saw a 10% jump on debut. Meanwhile, other major players like Nahdi Medical and Saudi German Hospitals are also listed on the local bourse.
The Saudi Vision 2030 plan is driving this momentum. The country is pouring cash into its healthcare infrastructure, with a goal of adding 26,000 to 43,000 hospital beds to support a population that is expected to touch 45 million by the end of this decade.
Fifteen IPOs on the Tadawul last year raised about 14.4 billion riyals. The frenzy is not at 2021’s fever pitch, which saw roughly $6 billion raised by firms like STC and ACWA Power, but Saudi Arabia remains one of the world’s busiest IPO markets.
Edited by Ankush Chibber. If you have any tips, ideas or feedback, please get in touch: talk-to-us@moniify.com
