Is Neom lining up its first-ever sukuk sale?

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WHAT WE’RE TRACKING TODAY

THIS MORNING: A new Africa-focused airline may be coming to Saudi + Sama wants applicants for a new investment banking training program

Good morning, friends, and happy THURSDAY to you all. We have a busy news morning for you, so let’s jump right in:

WATCH THIS SPACE #1- An unnamed investor is looking to launch a new airline serving routes to Africa, Aleqtisadiyah reports citing unnamed sources it says have knowledge of the plan. The airline has received the go-ahead from both local regulators and the African Civil Aviation Commission, according to the sources.

It’s just one of a number of possible shakeups of the local aviation industry: The Public Investment Fund announced in March 2023 that it will launch Riyadh Air. The challenger to Emirates and Qatar Airways will see its first flights in the air next year and aims to serve 100 destinations by 2030. Current national flag carrier Saudia will bid adieu to Riyadh by 2030 to make way for Riyadh Air and will instead base itself out of King Abdulaziz International Airport.

WATCH THIS SPACE #2- The Second Milling Co. (MC2) has changed its name to Arabian Mills, it said in a post on X. The miller, privatized in 2021 under the government’s privatization scheme for its state-owned milling firms, is said to be eyeing an IPO on Tadawul’s main market.

WATCH THIS SPACE #3- The Housing Ministry will ink an agreement next month with a Spanish real estate developer to build residential units within integrated residential communities and neighborhoods in Saudi, Al Riyadh reported yesterday, citing statements by minister Majed Al Hogail at the Saudi-Spain Business Forum in Madrid. He did not provide further details, but said the plan comes under the ministry’s target to raise home ownership by 70% in 2030.

In context: Al Hogail was in Spain for talks with Spanish officials on housing, infrastructure and real estate development among other topics.

DATA POINTS-

#1- The state-run Musaned recruitment platform for labor agencies here and abroad processed some 2 mn contracts last year for domestic workers from 33 countries, state news agency SPA . It didn’t give a comparable figure for 2022, but said growth in contracts processed came on the back of growing numbers of contracts for people from Ethiopia, Burundi, Sierra Leone, Tanzania and Gambia.

#2- Honey production in Saudi rose 41% y-o-y in 2023 to 3.1k tons in comparison with 2021 levels, state news agency SPA reported yesterday, citing data by the Environment Ministry-affiliated Sustainable Agricultural Rural Development Program (Reef Saudi).

PSAs-

#1- Do you have a recent finance or B-school grad in the family who is interested in a career in investment banking? The Saudi Central Bank is accepting applications for a six-week investment banking training program, it said in a statement yesterday. The program includes a mix of coursework and on-the-job training and was designed in partnership with the Wharton School at the University of Pennsylvania as well as top global banks and asset managers.

You (or your spawn) can apply for the programhere. The deadline is 30 May.

Get a 50% break on all of your unpaid traffic fines starting today, according to state news agency SPA yesterday. Want to take advantage of the break? You’ll need to cough up what you owe within the next six months.

WEATHER- Look for clear skies in Riyadh with a high of 32°C, dipping to 17°C overnight Makkah could sprinkles today with a high of 38°C (cooling to 25°C overnight) while Tabuk is looking at the chance of blowing dust with a high of 34°C today and a low tonight of 17°C.

THE BIG STORY ABROAD: WAR?

To use the language of the weather forecasters: It’s a mixed day for news around the world, with no single story holding sway and little but clouds in the sky.

#1- Mattering most to our corner of the world: Israel’s allies are increasingly convinced that it will respond militarily — in one form or another — to Iran’s Sunday missile and drone attack.

“It is clear that the Israelis are making a decision to act. We hope that they do so in a way that does as little to escalate this as possible,” British Foreign Minister David Cameron said yesterday as he headed into a meeting with Israel’s Benjamin Netanyahu, who yesterday warned Cameron and German Foreign Minister Annalena Baerbock (also in Tel Aviv for a visit) that “we will make our own decisions.” G7 nations have still not announced the sanctions on Iran that they hope might convince Netanyahu to sit tight.

MEANWHILE- Iran is readying its air force and said its navy will start escorting Iranian commercial ships in the Red Sea as it prepares for an Israeli attack on its territory or allies.

#2- AND- Ceasefire talks on Gaza seem as stalled as ever (Egypt and Qatar are mediating the negotiations) and Iran-backed Hezbollah wounded 14 Israeli soldiers in a drone and missile attack yesterday in retaliation for Israeli attacks that killed Hezbollah troops.

Looking ahead: The UN General Security Council will vote tomorrow on a Palestinian request for full membership in the world body. A “yes” vote would be tantamount to international recognition of Palestinian statehood, so expect a US veto. Palestinian President Mahmoud Abbas reportedly snubbed a request from the Biden administration to delay the request.

IN THE BUSINESS PAGES-

#3- Wall Street is tempering its expectations of a Fed rate cut this year, with most interpreting Jay Powell’s remarks earlier this week as meaning the first change in rates won’t come until September at the earliest. Bank of America economists, meanwhile, say there’s a “real risk” the central bank won’t cut rates until March 2025 “at the earliest.” CNBC has a solid roundup of sentiment.

That comes as IMF boss Kristalina Giorgieva warned overnight that “central banks should resist the temptation to lower their key interest rates too early and risk a resurgence of inflation and a fresh bout of policy tightening.”

It’s day four of the IMF and World Bank spring meetings in Washington, DC, so stay tuned for more policy discussion heading into the weekend. We’ll have the wrap-up for you in EnterpriseAM at the start of next week.

MEANWHILE- US equities have now posted their longest losing streak so far this yearafter the S&P 500 and the Nasdaq fell for a fourth day in a row.

SIGN OF THE TIMES- The “fear gauge” is soaring after Powell’s remarks and amid worries that Iran-Israel tensions could spill over into a regional war. The volatility index, or VIX, is at its highest level since Hamas’ attack on Israel, meaning “US investors are paying the biggest premiums since October to protect their portfolios against market gyrations.”

AND- Tuesday’s crazy rain and flooding in the UAE have captured the imagination of business editors, with the story getting front-page play in the Financial Times, CNBC, and Bloomberg, among others.

EnterpriseAM UAE reports that some buildings were still without power yesterday and Dubai International Airport warned passengers to “NOT come to the airport unless absolutely necessary.”

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SPORTS-

#1- Al Hilal lost 4-2 to UAE’s Al Ain in the first leg of the Asian Champions League semi-final yesterday, with Al Ain’s Soufiane Rahimi’s putting an end to the Saudi side’s record of 34 consecutive wins. The loss comes after the game was delayed for a day after Tuesday’s historic rain storm lashed the Emirates.

Time to focus on Jeddah-Riyadh clash: A scheduled fixture between Al Hilal and Al Ahli in the Saudi Pro League on Friday will now be played on Monday, 6 May, the SPL said yesterday in a post on X. Blame the delay in the Al Ain fixture for the postponement. Al Hilal currently sits on top of the league table with 77 points, while Al Ahli is third with 52 points.

#2- The World Masters of Snooker will come back to Riyadh next year with USD 1 mn purse on offer as Riyadh Season becomes an official partner of the World Snooker Championship, General Entertainment Authority Chairman Turki Alshikh said yesterday in a post on X.

ALSO- World number one snooker player Ronnie O’Sullivan will become a Saudi ambassador for the sport for the next three years. He’ll take part in all World Snooker Tour events here and coach young Arab talent.

CIRCLE YOUR CALENDAR-

The Gulf Film Festival wraps today in Riyadh. The five-day event showcases 29 films from across the region.

The King Salman bin Abdulaziz Royal Reserve Festival is also it its last day today at the Cultural Center in Al-Qurayyat governorate.

Riyadh will host the 2024 IsDB Group annual meeting from Saturday, 27 April until Wednesday, 30 April.

Riyadh will host a special meeting of the World Economic Forum on 28-29 April.

Riyadh will host the Saudi Water Forum from Monday, 29 April to Wednesday, 1 May.

Automechanika Riyadh will open on Tuesday, 30 April till Thursday, 2 May at the Riyadh International Convention and Exhibition Center.

Innovation Week 2024 will kick off on Sunday, 21 April, at the King Abdulaziz City for Science and Technology (KACST) in Riyadh.

Is Neom planning its first-ever sukuk sale?

A fresh hunt for funds by Neom: Neom is planning a SAR-denominated bond sale in what could be the gigaproject’s first-ever sukuk sale, Bloomberg reported, citing sources it says are close to the matter. The moves comes as Neom looks to diversify its funding sources and accelerate the pace of construction for its USD 500 bn development.

What we know: The sources said the offering could raise up to SAR 5 bn and could come as soon as 2H 2024, subject to market conditions.

The rationale? The Public Investment Fund has poured most of the funding into the project in the form of equity. The city’s developers are looking to diversify their sources of funding. The business information service says Neom secured a SAR 10 bn facility from a number of local lenders, while Sindalah, its luxury island destination, has taken on an additional SAR 3 bn in debt.

ADVISORS- Our friends at HSBC and the securities units of Al Rajhi Bank and the Saudi National Bank are said to be advising on the sukuk sale.

The PIF is also looking to tap global debt markets: The fund is reportedly considering more global bond sales and IPOs as it looks to ramp-up pace of investment. The move comes as the PIF is stepping in as the Kingdom’s treasury prepares to run deficits through 2026 and pace out the implementation of some aspects of select Vision 2030 projects. It plans to ramp up annual deployment capacity to USD 70 bn a year starting 2026, up from a current annual spending clip of USD 40-50 bn. The PIF has raised USD 7 bn since the start of the year in two global debt sales.

Why international markets? Officials at multiple levels of government and the PIF have repeatedly said in recent months that they don’t want to crowd private business out of the domestic debt market — and international appetite for the Saudi story is high.

It’s been all about Neom in the past few weeks: Bloomberg said earlier this month that planners had scaled back their estimate for how many people would live in Neom’s flagship project, The Line, by 2030, saying it would come in at a bit under 300k compared to the original 1.5 mn. That suggested a slower buildout with at least one of the contractors working on the project set to lay off some of the workers on site, the business information service wrote.

Neom has pushed back on the report — it brought in some 100 global construction firms earlier this week to assure them that the build-out plan remains unchanged.

Chinese interest? Neom officials yesterday marketed potential investments to Chinese companies while attending a construction forum in Shanghai. More than 100 Chinese contractors attended the session, part of Neom’s global “Discover Neom” tour.

eXtra gets shareholder approval to list 30% stake of subsidiary UIHC on Tadawul’s main market

Shareholders of electronics retailer eXtra have approved the sale via IPO of a 30% stake in the unit that owns and operates Tasheel Finance, according to a disclosure to Tadawul yesterday. Extra will sell 7.5 mn shares of United International Holding Co. (UIHC), its non-bank financial services arm, on Tadawul’s main market.

It’s not yet clear how much eXtra hopes to raise from the listing, but CEO Mohamed Galal told Al Arabiya yesterday the company would pull the trigger on the transaction by the end of the second quarter or of the fourth quarter of this year (watch, runtime: 9:50). “After receiving the necessary approvals [from relevant authorities], we will have six months [to finalize the listing],” he said.

Uh, Enterprise? Second or fourth? Yep — nobody in this part of the world goes to market with an IPO in the summer months. The equity-raising window runs January-May (or June) using FY or 1Q numbers and reopens in September.

Use of proceeds: A portion of the IPO’s proceeds would be channeled towards “repaying a part of eXtra’s debt estimated at SAR 190 mn,” Galal said.

A quick look at ownership: eXtra owns 99% of UIHC, which owns and operates the Tasheel brand, as well as Procco Financial Services in Bahrain. eXtra Bahrain owns 1% of UIHC.

UIHC has been doing well: The company turned in net income of SAR 156.8 mn for 9M 2023, up nearly 12% year on year — and good for a 41% net margin given that it posted revenues of SAR 383.2 mn in the same period.

And has big plans: UIHC says it wants to be the largest provider of shariah-compliant consumer finance in the Kingdom operating across multiple categories. It benefits from access to the 14 mn customers that pass through eXtra’s 48 stores across the country and is broadening the base of companies that it works with.

ADVISORS- Our friends at HSBC are quarterbacking the transaction. Look for news of the other advisors when the company’s prospectus drops./

A SOLID IPO PIPELINE-

We have a solid IPO pipeline for Tadawul’s main market taking shape for the remainder of the year:

PIF-backed lender Riyad Bank is considering the listing of its investment banking arm Riyad Capital;
Hotels and resorts operator Boudl has filed to go public;

Labor agency Smasco is in the chute;
Water treatment company Miahona has gotten approval for an offering of 30% of its shares;
Dr Soliman Abdul Kader Fakeeh Hospital (DSFH) has gotten regulatory approval to go public;
Fourth Milling Company will list before the end of June;
Singapore’s Olam Group is mulling the IPO of its Olam Agri subsidiary on Tadawul;
Hypermarket operator Lulu is said to be eyeing a dual listing on Tadawul and ADX;
Aster DM Healthcare looks set to spin-off its GCC assets and seek a dual listing on Tadawul and in the UAE.

And it’s shaping up to be a good run for Nomu: The parallel market’s pipeline this year includes Riyadh-based advisor Yaqeen Capital (itself a top advisor on Nomu IPOs), medical supplies outfit Qomel, Riyadh-based construction and mining firm Mohammed Hadi Al-Rasheed, Leaf Global Environmental Services, petroleum derivatives manufacturer Petrol Naas and Arabian United Float Glass. Nomu-listed Gas Arabian Services (GAS) also plans to debut an additional 10% stake on the market in a secondary share sale to meet the requirements to transition to Tadawul’s main market.

Riyad Capital is bullish about the software and services sector, but likes petrochems a bit less in its 1Q earnings forecast

Asset manager Riyad Capital published its 1Q 2024 earnings forecast for Tadawul-listed companies in its coverage universe. The software and services sector leads the list of companies it expects to post the sharpest earnings growth in the first quarter of 2024 (+17% y-o-y), followed by the healthcare sector at 13%, and banking at 8%.

MEANWHILE- The petrochemicals leads those facing margin pressure, with earnings set to contract at seven of the eight companies Riyad covers. Cement sector earnings will fall 23% and telecoms 10% year-on-year in 1Q, the bank preducts.

BULLISH CALLS-

The research house expects tech earnings to grow 8% y-o-y in 2024, led by Solutions by stc’s 10% y-o-y rise in net income to SAR 333 mn. It’s penciling in a 15% rise in Solutions’ revenues to SAR 3 bn.

The healthcare sector is expected to post healthy results, despite Ramadan falling in March this year around and placing pressure on results, the report reads. Riyad sees healthcare companies in its coverage universe growing their inpatient and outpatient segments as they take advantage of new capacity. HMG’s net income is expected to rise 9% y-o-y in 1Q 2024 to SAR 535 mn, and revenues to increase 10% to SAR 2.5 bn.

Alinma’s net income is expected to rise 46% y-o-y to SAR 1.4 bn in 1Q 2024, followed by Albilad at 6%, ANB and Al Rajhi at 4% each, and Banque Saudi Fransi (BSF), and Saudi Awwal Bank (SAB) at 3% each, the report reads.

BEARISH CALLS-

Petrochems: Aramco’s price hikes of feedstocks, along with the rise in shipping prices due to tensions in the Red Sea are expected to weigh on the 1Q earnings results of the petrochemicals sector. “Petrochemical companies in The Kingdom will have to weather continued soft demand and potentially begin right-sizing,” according to the report. Riyad Capital is maintaining its “uncertain-to-negative outlook in the short term for 1H24.” Tasnee is expected to be in the red this quarter with its net income falling 217% y-o-y, and Saudi Kayan is expected to remain in the red with a net loss of SAR 919 mn.

REMEMBER: Petrochemicals giant Sabic said, earlier this year, it expects feedstock prices to surge by 1.7% of the company’s annual cost of sales on the back of Aramco’s hike in feedstock prices, with the impact materializing in the current quarter. Also Fertilizers maker Sabic Agri-Nutrients forecasted a 3.8% increase of the company’s annual cost of sales, while Yanbu National Petrochemical Co (Yansab) expected an increase averaging 2.8% of the company’s annual cost of sales.

Riyad is also bearish on the performance of the cement, and telecoms sectors. By contrast, Al Jazira Capital expects cement producers under its active coverage to see their net income rise almost 33% y-o-y in 1Q 2024.

Acwa Power, Dewa reach financial close of solar-powered Hassyan desalination project

Renewable energy giant Acwa Power reached financial close with Dubai state utility Dewa on its solar-powered Hassyan water desalination project in Dubai, according to a statement from Dewa (pdf) yesterday. The news comes weeks after Acwa Power secured SAR 2.77 bn (USD 738.4 mn) from local and international lenders to fund the development and construction of the AED 3.4 bn (USD 925.8 mn) Hassyan project.

The largest of its kind: The plant, which is set to produce 180 mn imperial gallons per day, is the “world’s largest project of its kind using reverse osmosis technology” on what the industry calls an independent water producer (or “IWP”) model, according to the statement. Acwa Power holds a 20.4% stake in the project.

BACKGROUND- Dewa signed a 30-year water purchase agreement with Acwa Power to buy water from phase one of the plant. Dewa will purchase the desalinated water at a price of around USD 0.365 per cbm — the lowest bid the Dubai state facility received.

SOUND SMART- An IWP is just an industry-specific type of public-private partnership that sees a private-sector partner ink a long-term (20-30 year) agreement to design, build, finance, and operate a water plant for a government. The state, in turn, will derisk the project with an offtake agreement (called a “water purchase agreement,” or WPA, as we note above) that generally provides a floor for pricing and clarity to would-be bankers about the project’s financials.

Sabic opens world’s first pilot plant for steam cracker furnaces powered by renewable energy

Sabic takes steps to build renewables into the petchem industry: Petrochemicals giant Sabic has inaugurated the world’s first demo plant incorporating steam cracker furnaces powered by renewable energy, it said in a statement yesterday. The plant was built with technology from German chemical company BASF and US-German industrial gases giant Linde.

What we know: The demonstration plant sees electricity used as a heat source for the production of olefin — a key hydrocarbon used to make plastics and synthetic fiber — at BASF’s Verbund site in Ludwigshafen. The technology could potentially cut emissions from the energy-intensive production process by at least 90%, according to Sabic. The plant has two separate furnaces fired by 6 MW of energy generated from renewable sources and can process around 4 tons of hydrocarbon per hour.

Steam cracker furnaces for dummies: In the chemicals industry, steam cracker furnaces are used to break longer hydrocarbons into shorter chains used to manufacture chemical and polymer products including plastic, rubber and detergents as well as raw materials used in the clothing and packaging industries. It’s a crazily energy-intensive process, relying on natural gas to achieve temperatures of around 850°C.

Looking ahead: Linde will look to commercialize the technologies in the future under new trademark Starbridge, hoping to sell into the petchem industry’s drive to reduce its carbon footprint.

REMEMBER- Sabic is on a decarbonization spree: Sabic signed a memorandum of understanding in December that will see it and its affiliate Scientific Design (SD) work with Linde Engineering to explore how to decarbonize SD’s ethylene glycol process, which is used under license at glycol manufacturing plants around the world. Its efforts come under a pledge in 2021 to achieve carbon neutrality by 2050. It has set an interim target of lowering greenhouse gas emissions (Scope 1 and 2) by 20% by 2030.

Passenger numbers across Saudi airports hit record 112 mn last year

Saudi’s aviation sector saw a 26% y-o-y jump in passenger numbers to a record 112 mn in 2023, according to the General Authority of Civil Aviation’s (GACA) annual report (pdf). The total number of flights grew 16% y-o-y to 815k, the report showed.

Deep dive: Some 421k domestic flights — both scheduled and non-scheduled — transported 51mn travelers domestically, while international flights hit 394k with 61 mn passengers, according to the report.

That beats pre-pandemic levels: GACA said Saudi’s airports operated 9% more flights last year than they did in 2019, when covid-19 set in.

Jeddah leads the pack: Jeddah’s King Abdulaziz International Airport topped Saudi airports in the number of flights and passengers volumes in 2023, beating Riyadh’s King Khalid International Airport’s lead in 2022. Jeddah saw 262 flights carrying 43 mn passengers last year, while Riyadh served 239k flights with 31.9 mn passengers on board.

ICYMI- Jeddah’s airport outperformed peers among all airports serving 15 mn or more passengers per year, data by GACA in January showed.

Three busiest months: GACA said that March, July and December were the busiest at airports last year. Peaks in the summer were driven by tourists and pilgrims for Hajj, accounting for 53% of total international arrivals.

Saudi Cable appoints Fawaz Al Muqbel as new CEO

The board of Tadawul-listed Saudi Cable appointed Fawaz Mubarak Al Muqbel (bio) as its new CEO, effective yesterday, it said in a disclosure to Tadawul yesterday. Mubarak is replacing Nael Samir Fayez (Linkedin), who was appointed advisor to the board. Al Muqbel holds over 34 years of experience, with top leadership positions in the Middle East Cable Company (Misk), the National Industrial Company, and the Steel Products Company (Stepco).

Cenomi’s Rehill makes Forbes real estate list + Saudi asset managers dominate ranking

Cenomi Centers CEO Alison Rehill was named among Forbes Middle East’s Most Impactful Real Estate Leaders in 2024.

AND- Some 14 Saudi asset managers were recognized in the magazine’s list of Top 30 Asset Managers for 2024, the best placing by any country on the list. Among those recognized:

#1- Rashed Sharif, CEO of SNB Capital;
#3- Mazin Fawaz Boghdady, CEO of Alinma Investment;
#4- Abdullah Abulrahman Alshwer, CEO of Riyadh Capital;
#6- Waleed AlRashed AlHumain, CEO of Al Rajhi Capital;
#8- Tariq Al-Sudairy, managing director and CEO of Jadwa Investment;
#11- Khaled Abdulaziz Alrayes, CEO of Alithmar Capital;
#12- Ali Almansour, managing director and CEO of SAB Invest;
#14- Salam AlKhunaizi, CEO of Saudi Fransi Capital;
#15- Samer Abu Aker, CEO of Sedco Capital;
#17- Khalid S. Al-Ghamdi, CEO of ANB Capital;
#19- Naif Almesned, managing director and CEO of AlJazira Capital;
#21- Zaid Almufarih, CEO of Albilad Capital;
#23- Hani Othman Baothman, Chairman of Sidra Capital;
#25- Ahmed Saud Ghouth, CEO of Alkhabeer Capital.

#2- Diriyah Group CEOJerry Inzerillo was named first UN ambassador for sustainable tourism in the Kingdom, the PIF-owned company said in a LinkedIn post yesterday.

#3- Madinah’s Prince Mohammad bin Abdulaziz International Airport was named best regional airport in the Middle East at the Skytrax World Airport Awards for 2024, a rankings list by Skytrax showed.

Iran-Israel tensions, AlUla and Esports drive the conversation for foreign press

It’s a mixed bag for Saudi in the foreign press today, with Iran-Israel tensions, AlUla and Esports making the rounds. The Kingdom and the UAE issuing a joint statement calling for maximum “self-restraint” and warning regional players against the “dire consequences” of war earned coverage from Bloomberg. The statement came following a phone call between Crown Prince Mohammed Bin Salman and Emirati President Mohamed bin Zayed Al Nahyan, in which the two discussed Iran’s unprecedented attack on Israel.

Meanwhile, CNN sees Riyadh’s Esports World Cup (EWC) as a lifeline to the ailingindustry, featuring the “largest prize pool in esports history” — a USD 60 mn jackpot. The event — which is not funded by the Public Investment Fund — will run for eight weeks, starting late June.

Although not everyone is on the same page: Apex Legends — one of the clubs competing in EWC — will reportedly not be altering its inclusive characters and cosmetics to fit the Kingdom’s cultural norms, the game’s developers have told Kotaku after the tournament faced some backlash over it being hosted in the Kingdom.

ALSO WORTH A SKIM-

Bloomberg is out with a travel review and extensive critique of Habitas AlUla’s too-good-to-be-true resort in the desert.
The Guardian is out with yet another piece on Saudi women’s rights.

Saudi Tourism Ministry talks up investment at Berlin’s IHIF. Plus: debt, energy and localization

TOURISM-

The Tourism Ministry highlighted potential investments in Saudi’s tourism sector with several unnamed global investors at the International Hospitality Investment Forum (IHIF) in Berlin, state news agency SPA reported yesterday. They highlighted a new tourism investment program unveiled last month to facilitate doing business and attracting local and foreign investors.

ICYMI- The Tourism Investment Enablers Program (TIEP) includes regulatory reforms for tourism licensing depending on type and scale of operations and reduced fees. It aims to lure in investments of up to SAR 42 bn (c. USD 11 bn) with inflows of SAR 16 bn to GDP by 2030.

REMEMBER- The ministry recently doubled its target for 2030, hoping now to be host to 150 mn tourist trips after it hit its target last year ahead of schedule. The new 2030 target sees 80 mn by domestic travelers and 70 mn by international travelers.

DEBT WATCH-

Nomu-listed National Building and Marketing has renewed a nine-month SAR 85 mn shariah-compliant credit facility with Alinma Bank to finance its working capital, it said in a regulatory filing to Tadawul. The Riyadh-based group manufactures and installs construction materials including glass, aluminum and iron.

ENERGY-

Caribbean island St. Kitts and Nevis secured USD 40 mn soft loan from the Saudi Fund for Development on the sidelines of IMF / World Bank spring meetings, state news agency SPA reports. The funds are earmarked for the construction of a 18 MW dual-fuel power generation station.

MANUFACTURING-

GameChange Solar + JZNEE to build 3 GW component production facility in Saudi: US-based solar tracker manufacturer GameChange Solar (GCS) and Chinese renewables firm Jiangsu Zhenjiang New Energy Equipment (JZNEE) will partner on building a 3 GW capacity tracker manufacturing facility in Dammam, with hopes to expand to 5 GW, according to a statement. The components produced — including actuators, node controllers, and drive systems — will be used for GCS’s Genius Tracker projects, the statement said, without naming any specific projects. The facility is expected to be operational by June.

LOCALIZATION-

Tadawul-listed telecoms operator Zain has unveiled a new fleet management system that’s 100% locally produced, the company said in a press release. The new service offers businesses a real-time GPS tracking option on their logistics operations, allowing them to optimize travel routes and curb fuel consumption. The monitoring solution is connected to a local cloud-based platform.

FINANCIAL SERVICES-

The Saudi Economic and Development Securities Co. has been cleared to offer its SEDCO Capital Multi Asset Traded Fund units on Tadawul as a close-ended traded fund, a statement from the Capital Market Authority (CMA) read. The fund, which has a capital of SAR 1 bn, invests in real estate.

Deficits in the US, China could hurt global economy

Careful now, big spenders: The US and China need to implement policies to address the imbalance between spending and revenues, which is adding to inflationary pressures and posing significant risks to the global economy, the IMF has warned in its latest Fiscal Monitor (pdf) out yesterday. Rampant spending from the world’s two largest economies could “have profound effects for the global economy and pose significant risks for baseline fiscal projections in other economies,” the Fund said.

How bad is it? The US will record a fiscal deficit of 7.1% in 2025, over three times the 2%average clocked in by other advanced economies, while China will record a deficit over twice the average of other EMs with 7.6%, the IMF said. The shortfall comes as both countries look set to face challenges ahead, with China dealing with weak domestic demand and a real estate crisis and the US entering a key year for fiscal policy in an election year that will see candidates pledging further tax cuts and increased state spending.

When the US spends, EMs pay: “Large and sudden increases” in US borrowing costs willlikely send global government bond yields soaring and exchange rates into murky waters in emerging markets and developing economies, the IMF said. “A 1 percentage point spike in US rates results in a 90 basis point rise in other advanced economies and an increase in EMs of 1 percentage point,” the salmon-coloured paper writes.

THE MARKETS THIS MORNING-

Asian markets are little changed in early trading this morning after Wall Street posted on Wednesday its first four-day string of losing days since the start of the year. The Kospi is the sole standout, up a bit more than 1.4% at dispatch time this morning. European and US equities futures were mostly unchanged overnight.

TASI	12,466	-0.3% (YTD: +4.2%)
MSCI Tadawul 30	1,569	-0.6% (YTD: +1.2%)
NomuC	26,402	+0.4% (YTD: +7.6%)
USD : SAR (SAMA)	3.75 Buy	3.75 Sell
Interest rates	6.5% repo	5.5% reverse repo
EGX30	29,668	+0.9% (YTD: +19.2%)
ADX	9,165	-0.3% (YTD: -4.3%)
DFM	4,173	-0.3% (YTD: +2.8%)
S&P 500	5,022	-0.6% (YTD: 5.3%)
FTSE 100	7,848	+0.4% (YTD: 1.6%)
Euro Stoxx 50	4,914	-0.1% (YTD: 8.7%)
Brent crude	USD 89.40	-0.7%
Natural gas (Nymex)	USD 1.72	+0.3%
Gold	USD 2,380	-0.3%
BTC	USD 61,397	-3.9% (YTD: +112.9%)

THE CLOSING BELL: TADAWUL-

The TASI fell 0.3% yesterday on turnover of SAR 9.6 bn. The index is up 4.2% YTD.

In the green: Sharqiyah Dev (+10%), Batic (+9.3%) and SGS (+9.1%).

In the red: Cenomi Retail (-5.2%), Astra Industrial (-3.7%) and Etihad Etisalat (-3.4%).

THE CLOSING BELL: NOMU-

The NomuC rose 0.4% yesterday on turnover of SAR 30 mn. The index is up 7.6% YTD.

In the green: Future Care (+10.7%), Ladun (+10%) and Mayar (+7.9%).

In the red: AlQemam (-9.7%), SPC (-6.1%) and Clean Life (-5.7%)

CORPORATE ACTIONS-

Shareholders of Edarat Communication and IT have approved doubling the company’s capital to SAR 25.2 mn through a bonus issuance, it said in a disclosure to Tadawul yesterday. The capital hike will be made to support the cloud service provider’s capital base and future activities, it said.

CALENDAR

APRIL

11-20 April (Thursday-Saturday): IMF and World Bank spring meetings, Washington, DC.

21-27 April (Sunday-Saturday): Innovation Week 2024 at KACST, Riyadh.

27-30 April (Saturday-Wednesday): IsDB Group Annual Meetings, Riyadh.

28-29 April (Sunday-Monday): World Economic Forum Special Meeting, Riyadh.

29 April-1 May: Future Hospitality Summit at Al Faisaliah Hotel, Riyadh.

30 April-2 May: Automechanika Riyadh 2024 at Riyadh International Convention and Exhibition Center.

MAY

2-5 May (Thursday-Sunday): Townhall Expo, Riyadh.

6-9 May (Monday-Thursday): Saudi Smart Manufacturing, Riyadh.

6-9 May (Monday-Thursday): Saudi Smart Logistics, Riyadh.

13-15 May (Monday-Wednesday): Smart Future Expo, Riyadh.

13 May (Monday): Saudi Giga Projects, Riyadh.

19-21 May (Sunday-Tuesday): Saudi Energy Convention, Riyadh.

20-21 May (Monday-Tuesday): Future Projects Forum, Four Seasons Hotel, Riyadh.

20-22 May (Monday-Wednesday): Future Aviation Forum 2024, Riyadh.

21-23 May (Tuesday-Thursday): The Saudi Food Show, Riyadh.

Signposted to happen sometime in May:

Global Trade Review (GTR): KSA
Saudi Energy Convention

JUNE

4-7 June (Tuesday-Friday): Saudi Sports Show, Riyadh.

4-7 June (Tuesday-Friday): Aqarat Expo, Riyadh.

5 June (Wednesday): World Environment Day.

14-22 June (Friday-Saturday): Banks and capital markets closed for Eid Al Adha holiday.

AUGUST

12-15 August (Monday-Thursday): The Saudi Food Expo, Riyadh

SEPTEMBER

11-12 September (Wednesday-Thursday): The Saudi Event Show, Riyadh.

17-19 September (Tuesday-Thursday): EV Auto Show, Riyadh.

24-26 September (Tuesday-Thursday) Saudi Infrastructure Expo, Riyadh International Convention and Exhibition Center, Riyadh.

23 September (Monday): National Day (national holiday)

NOVEMBER

2-9 November (Saturday- Saturday): WTA Finals, Riyadh.

26-28 November (Tuesday-Thursday): Saudi Electricity Expo, Riyadh.

11-14 November (Monday-Thursday): Cityscape Global, Riyadh.

DECEMBER

2-13 December (Monday-Friday): Conference of the Parties (COP16) to the United Nations Convention to Combat Desertification, Riyadh.

Signposted to happen sometime in 2024:

The AFC Champions League Elite

2025

FEBRUARY

10-13 February (Monday-Thursday): Leap 2025, the Kingdom’s premier tech investment conference

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