Good morning, wonderful people. We wrap a busy week with a relatively calm morning before the long-awaited weekend.

In today’s issue: SAR 8 bn real estate funds from Sedco Capital and Sumou Investment, a SAR 1.1 bn expansion plan from Balady Poultry, and our in-depth look at Saudi 2024 IPOs performance which outperformed peers in the UAE and Egypt, and the latest on debt capital markets, earnings and VC funding. Let’s dive in.

HAPPENING TODAY-

#1- LIV Golf Riyadh’s season opener starts today at the Riyadh Golf Club and wraps up on Saturday, 8, February. Buy your tickets here.

#2- The Saudi Open Kickboxing Championship (pdf) kicks off today at the Prince Faisal bin Fahd Sports City Stadium. The tournament wraps up on Saturday, 8 February.

WEATHER- Riyadh is looking at some thunderstorms today, along with a high of 26°C and a low of 15°C, while a windy Jeddah will see its mercury peak at 29°C and hit a low of 23°C. Meanwhile, Makkah will see a 30°C high and 19°C low.

WATCH THIS SPACE-

#1- Panda — Savola’s consumer retail unit — is set to expand its physical footprint in Saudi by some 20 new stores in 2025, with a focus on Riyadh and remote regions, COO Abdullah Al Sabban told Arab News. The company is funding its expansion through internal resources.

IPO in the right timing: “There are some thoughts, but we’re still discussing, negotiating, and understanding what would be the right time and approach for something like that,” Al Sabban said. Rumors of an upcoming IPO for Panda have been making the rounds since last year.

#2- Construction costs in the Kingdom are expected to rise by 5-7% this year, on the back of supply chain disruptions and economic uncertainty, Currie & Brown expects in a report seen by Zawya. Developments in Tech and AI will increase demand for scarce materials. Meanwhile, the ongoing shortage of skilled construction workers will worsen in 2025, driving up labor costs in high-growth sectors, the report argued.

Even higher housing costs: The rise in construction costs could push housing costs — the primary driver of Saudi’s annual inflation rate throughout 2024 — even higher. Home prices in in Riyadh were reported last month to be 81% higher than they were during the pandemic, with apartment prices up 56%.

PSAs-

Khayala open for registration: The National Housing Company is now accepting registrations of interest for its Khayala project in north Jeddah, it said in a post on X.

DATA POINTS-

#1- Consumer spending via point-of-sale (PoS) transactions in the Kingdom jumped 38.7% w-o-w for the week ending February 1 to SAR 15.5 bn, according to the Saudi Central Bank’s (Sama) report (pdf). Meanwhile, the number of weekly transactions rose 21.5% to 222.67k.

The breakdown: Food and beverages made up the biggest chunk of spending in terms of value during the week, edging up 54.3% w-o-w to SAR 2.5 bn, followed by restaurants and cafes at SAR 2.2 bn, marking a 31.3% increase. Hotels recorded the slowest weekly increase in value, rising only 12.7% w-o-w. Riyadh had the highest value of PoS transactions at SAR 5.2 bn, followed by Jeddah at SAR 2.1 bn.

#1- Spending on mobile apps grew 11% y-o-y in 2024 to USD 1.1 bn, placing the Kingdom at number 16 globally in terms of app spending, Aleqtisadiah reports, citing data from Sensor Tower. Social media apps accounted for the lion’s share of spending at USD 247 mn, followed by streaming apps at USD 124 mn, and social discovery apps at USD 93 mn. Meanwhile, spending on AI apps grew 235% y-o-y to USD 16.6 mn.

#2- Saudi Arabia issued over 4.6k investment licenses in 4Q 2024, marking a 59.9% y-o-y increase and pushing 2024’s annual growth to 67.7%, according to an Investment Ministry report (pdf). This figure does not include licenses issued under Saudi Arabia’s Tasattur anti-concealment program.

#3- The General Authority for Competition approved 16 requests for merger and acquisition transactions in January, it said in a post on X.

OIL WATCH-

Opec oil output fell in January for the second month in a row, hitting 26.53 mn bbl / d, 50k bbl / d lower than December, Reuters reports citing a survey. This came as falling production levels in Iran and Nigeria offset a 90k bbl / d gain from the UAE.

ICYMI- Opec+ — the wider group including non-Opec oil producers — decided at earlier this week to maintain its policy of capping supplies in 1Q before starting to ramp up output in April. Opec+ initially planned to begin phasing out production cuts in October, but later pushed the plans back as oil prices fell. Production increases are now slated to begin in April 2025 and to be gradually implemented until the end of 2026.

SPORTS-

#1- SPL eyes larger presence in Brazil: Executives from the Saudi Pro League (SPL) are in Brazil for meetings with the Brazilian League, the Brazilian Football Confederation, and major sports marketing agencies to expand the SPL’s presence in one of the world’s biggest football markets, Arab News reports.

Part of the play: SPL is launching dedicated Brazilian social media channels while also organizing a physical presence at major football events as part of its plan to increase engagement with Brazil’s football community. The Saudi league currently boasts 26 Brazilian players — more than any other nationality — and has reached upwards of 50 mn views in the country during 2023-24 by streaming 100 matches via YouTube.

#2- SPL’s four PIF-backed clubs — Al Nassr, Al Hilal, Al Ittihad, and Al Ahli — spent over GBP 100 mn during the January transfer window, according to The Athletic. Meanwhile, the remaining 14 teams in the league spent an aggregate GBP 12.1 mn during the same period, the outlet said, citing the Transfermarkt website. Al Nassr and Al Ahli were the largest spenders, with Al Nassr shelling out GBP 64.5 mn, plus add-ons, to secure secure Jhon Duran, while Al Ahli signed FC Porto’s Galeno for GBP 41.6 mn, after Al Ittihad backed out last minute.

Brace for the summer: A surge in signings is expected during the summer transfer window, as a period of calm usually precedes an uptick in big-ticket signings, unnamed senior officials with knowledge of the SPL told the Athletic.

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THE BIG STORY ABROAD-

For the second morning running, the foreign pages are all about Trump’s proposal for Gaza’s future, which was met with a strong stance from international leaders.

Calls of permanently displacing Gazans sparked a strong international outcry with UN Secretary General Antonio Guterres calling for adherence to international law and avoiding “any form of ethnic cleansing.” Meanwhile, German Foreign Minister Annalena Baerbock warned the plan would “lead to new suffering and new hatred.”

Toning down: Trump’s aides scrambled to walk back the most controversial elements of his proposal, stating he did not commit to deploying US troops in Gaza, and clarifying a resettlement would be temporary to pave the way for reconstruction efforts, and that the US will not pay the bills. (Bloomberg | New York Times | FT)

AND IN THE BUSINESS PAGES- Beijing filed a World Trade Organization complaint against “protectionist” 10% tariffs on Chinese imports. Trump had said earlier he was in “no hurry” to speak with President Xi Jinping.

ALSO- It’s not looking good for Nissan + Honda: Negotiations over the USD 60 bn anticipated merger — that would have created the world’s third-biggest automaker — have reportedly hit a wall. One major sticking point was Honda wanting a bigger piece of the holding company, with Nissan becoming a subsidiary — a plan the latter rejected as it opted for a merger of equals. (Reuters | New York Times | WSJ)

CIRCLE YOUR CALENDAR-

Capital Markets Forum 2025 will run between 18-20 February at Riyadh’s KAFD Conference Center and Four Seasons Hotel Riyadh. The event — held under the theme “Powering Connections” and organized by Saudi Tadawul Group — will showcase the Kingdom’s growing capital market while featuring panel discussions on topics including digital transformation, ESG investments, regional economic integration, and market diversification. It will bring together major players in the financial sector, such as global investors, issuers, and decision-makers. The forum will also host the 2024 Saudi Capital Market Awards.

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