Economic experts and analysts see the plan by the Umm Al-Qura for Development and Construction Company (Umm Al-Qura) to list its shares on the Saudi Stock Exchange (Tadawul) as a strategic move to strengthen the stock market, boost Saudi Arabia’s economy, speed up infrastructure projects and improve life in Makkah.
The move is also expected to increase investor confidence and improve transparency and governance.
Umm Al-Qura is a leading developer of modern destinations and the owner of the Masar project, which aims to serve Makkah’s residents and visitors. It offers an integrated investment ecosystem in the heart of the city, home to the Holy Kaaba.
Umm Al-Qura announced on Monday its plan to offer 130.8 million new shares, representing 9.09% of total shares after a capital increase.
The Masar project in Makkah covers 1.2 million square meters and aims to boost the holy city’s infrastructure, including hotels, housing, shops and cultural centers.
Tadawul gave conditional approval for the listing on December 8, 2024, and the Capital Market Authority (CMA) approved the public offering on December 24, allowing the company to raise funds for land settlements, infrastructure, and expansion.
Founded in 2012, Umm Al-Qura is backed by major Saudi entities like the Public Investment Fund and the General Organization for Social Insurance.
The company plans to use the proceeds from the IPO to fund infrastructure, land settlements and the Masar project, valued at 100 billion riyals ($26.66 billion).
Dr. Mohammed Al-Qahtani, an economics professor at King Faisal University, said this move will strengthen the Saudi stock market, increase the company’s capital and inject new liquidity to speed up infrastructure projects in Makkah.
Speaking to Asharq Al-Awsat, he added that this is a better alternative to traditional financing, improving transparency and governance, which will boost investor confidence.
He emphasized that the move supports Saudi Arabia’s Vision 2030 goal to fast-track infrastructure projects, promotes religious tourism and contributes to the stock market’s growth, making it the largest in the region.
The company’s projects will also boost Saudi Arabia’s economy by increasing visitors during the Hajj and Umrah, expanding hotel and housing capacity, creating jobs and attracting local and foreign investment.
Dr. Suleiman Al-Hamid Al-Khalidi, a financial markets analyst, explained that the IPO will raise funds for the 100 billion riyal ($26.6 billion) Masar project.
This will strengthen the project and increase the number of companies listed on the Saudi stock market, diversifying investment opportunities, he told Asharq Al-Awsat.
The listing offers an opportunity for investors to be part of a major project in Makkah, which is likely to attract both local and international interest. The project will have a significant impact on Saudi Arabia's economy, he remarked.
The Masar project, supporting Vision 2030, aims to increase Makkah’s capacity to welcome 30 million visitors by 2030. It will improve infrastructure and boost religious tourism, creating jobs and supporting economic growth.
The project focuses on developing a 3.5-kilometer area in western Makkah with services like accommodation, offices, retail centers and healthcare facilities.
