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Saudi Stocks Resume Trade Activity, Jump 137 Pts

Saudi Stocks Resume Trade Activity, Jump 137 Pts
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Saudi Stocks Resume Trade Activity, Jump 137 Pts

Saudi Stocks Resume Trade Activity, Jump 137 Pts

Saudi stock market gains jumped on Tuesday with trade activity resuming after a two-day holiday celebrating the Kingdom’s 88th National Day.

Jumping 137 points, the Saudi index closed at 7,905 points on Tuesday, well above its 200-day average. Analysts read into the jump as a positive technical signal for the index.

The number of shares traded exceeded 121 million shares in over 99 thousand transactions.

In a related context, the Saudi Arabian Capital Market Authority (CMA) approved the initial public listing of 30 percent, or 6 million shares, of Gulf Steel Works Company.

"The prospectus will contain the information and data that the investor needs to know before making the investment decision or not, especially with respect to share prices and financial statements of companies," the market regulator said in a statement.

The prospectus will include all relevant information including the share price, the company's financial statements, activities and management. The document will be published within sufficient time prior to the start of the subscription period.

According to the CMA, the approval will be valid for six months from the board resolution date and will be canceled if the offering and listing of the company's shares are not completed within this period.

However, the CMA approval of the request should not be considered as an endorsement of the feasibility of the investment in the offering or in the shares of the company concerned.

The decision to approve the request means that the regulatory requirements have been complied with in accordance with the Capital Market Law and its Implementing Regulations, the CMA’s statement added.

These developments come after the Saudi Council of Economic and Development Affairs (CEDA) approving the Financial Sector Development Program 2020, which is one of the main programs to achieve goals of the Saudi Vision 2030.

The program’s objectives include creating a diversified and effective financial services sector to support the development of the national economy, diversify its sources of income, and stimulate savings, finance, and investment by addressing the sector’s challenges.

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Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
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Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)

Telecommunications companies listed on the Saudi Stock Exchange (Tadawul) achieved a 12.46 percent growth in their net profits, which reached SAR 4.07 billion ($1.09 billion) during the second quarter of 2024, compared to SAR 3.62 billion ($965 million) during the same period last year.

They also recorded a 4.76 percent growth in revenues during the same quarter, after achieving sales worth more than SAR 26.18 billion ($7 billion), compared to SAR 24.99 billion ($6.66 billion) in the same quarter of 2023.

The growth in the revenues and net profitability is the result of several factors, including the increase in sales volume and revenues, especially in the business sector and fifth generation services, as well as the decrease in operating expenses and the focus on improving operational efficiency, controlling costs, and moving towards investment in infrastructure.

The sector comprises four companies, three of which conclude their fiscal year in December: Saudi Telecom Company (STC), Mobily, and Zain Saudi Arabia. The fiscal year of Etihad Atheeb Telecommunications Company (GO) ends on March 31.

According to its financial results announced on Tadawul, Etihad Etisalat Company (Mobily) achieved a 33 percent growth rate of profits, bringing its profits to SAR 661 million by the end of the second quarter of 2024, compared to SAR 497 million during the same period in 2023. The company also achieved a 4.59 percent growth in revenues to reach SAR 4.47 billion, compared to SAR 4.27 billion in the same quarter of last year.

The Saudi Telecom Company achieved the highest net profits among the sector’s companies, at about SAR 3.304 billion in the second quarter of 2024, compared to SAR 3.008 billion in the same quarter of 2023. The company registered a growth of 4.52 percent in revenues.

On the other hand, the revenues of the Saudi Mobile Telecommunications Company (Zain Saudi Arabia) increased by about 6.69 percent, as it recorded SAR 2.55 billion during the second quarter of 2024, compared to SAR 2.39 billion in the same period last year.

Commenting on the quarterly results of the sector’s companies, and the varying net profits, the head of asset management at Rassanah Capital, Thamer Al-Saeed, told Asharq Al-Awsat that the Saudi Telecom Company remains the sector leader in terms of customer base expansion.

He also noted the continued efforts of Mobily and Zain to offer many diverse products and other services.

Financial advisor at the Arab Trader Mohammed Al-Maymouni said the financial results of telecom sector companies have maintained a steady growth, up to 12 percent, adding that Mobily witnessed strong progress compared to the rest of the companies, despite the great competition which affected its revenues.

He added that Zain was moving at a good pace and its revenues have improved during the second quarter of 2024. However, its profits were affected by an increase in the financing cost by SAR 26.5 million riyals and a rise in interest, while net income declined significantly compared to the previous year, during which the company made exceptional returns.