Aramco’s net income posts 25% y-o-y growth in 1Q despite Hormuz disruptions

Aramco’s 1Q earnings are the latest thing that makes us think our thesis is correct: We’re heading into a golden age for MENA+ infrastructure that we think will be marked by massive spend to “harden all the things” while building in redundancies to redundancies. We also have some IPO news for you this fine morning — and we’re nowhere near as bullish as some on Saudi’s debt market getting an uplift from passive flows.

UP FIRST- Aramco’s East-West pipeline did what it was built for. The state oil giant’s 1Q net income climbed 25% y-o-y to USD 32.5 bn as the bypass routed more than 7 mn bbl / d around Hormuz — 5 mn for export, 2 mn into domestic refineries — and stronger global crude and refining margins offset the export drag. The pipeline “has proven itself to be a critical supply artery, helping to mitigate the impact of a global energy shock and providing relief to customers affected by shipping constraints,” CEO Amin Nasser said in the earnings statement (pdf).

Aramco isn’t pulling back on the divvy, staying on course at USD 21.9 bn for the quarter (and USD 87.6 bn for the full year).

Nasser paired the results with a warning. He told Bloomberg some 1 bn barrels of supply have already been lost from global markets in the past two months, and that the market normalizes “only in 2027” if shipping stays curtailed more than a few weeks.

Watch this space: Aramco’s earnings call is today. We’ll be listening to see if there’s color worth reporting back in Wednesday’s issue.

From The Dept. of Talking One’s Book: Saudi bonds are due some USD 10 bn in passive inflows next year, Tadawul boss Mohammed Alrumaih told Bloomberg. The trigger: SAR-denominated sovereign sukuk are set to join JPMorgan’s Emerging Markets Government Bonds Index and Bloomberg’s EM Local Currency Government Index from 29 January 2027. Eight Saudi sovereign sukuk totaling nearly USD 69 bn already meet the inclusion criteria. The sukuk will ultimately account for 2.5% of EMGBI. For context: foreign investors hold just 8% of local government bond issuances today, with only USD 3 bn traded OTC in 1Q.

Our take: Active fund managers aren’t going to suddenly pile into KSA. The equity-market experience in Saudi has been that index inclusion brings the passive money but does not necessarily pull active foreign capital in behind it. Tadawul remains dominated by domestic retail and domestic institutions, with active foreign participation thinner than the FTSE and MSCI inclusion stories suggested it would be. There’s no obvious reason to think the bond version of the trade plays out differently. The USD 10 bn will come — it’ll just be exactly the size of the index allocation, no more.

Saudi delivery app Ninja is lining up advisors for a USD 1 bn Tadawul IPO in late 2026 or early 2027, Bloomberg reports, citing sources it says are in the know. The company has tapped Citigroup, Goldman Sachs, Riyad Capital, and UBS to advise, though a private funding round is still on the table as a fallback. Ninja has been exploring IPO options since March — executives met London investors around then as part of early soundings — with Tadawul preferred over overseas exchanges like the NYSE.

Tadawul has held up through the geopolitical noise, making it the steadier exit for deals that need to clear in the next 18 months. The Saudi IPO pipeline keeps moving while broader Gulf listings slow: Dar Al Balad broke the post-war drought at USD 55 mn, and Mutlaq Al Ghowairi Contracting and Arabian Dyar are still racing late-June CMA expiries.

Speaking of Dar Al Balad… Retail investors have until 14 May to get orders in as the company offers 30% of its shares at SAR 9.75 apiece, the top of the range. The institutional book cleared at a final size of SAR 205 mn (USD 55 mn), valuing the company at SAR 682 mn (USD 182 mn). That’s smaller than the Ninja figure, sure, but the symbolic weight is bigger — this is the first IPO out the gate since the war broke regional capital markets in February.

MEANWHILE- Egypt’s Al Ahly Sabbour is hitting the brakes on its planned EGX debut until the war resolves. A public listing has been in the pipeline since 2017 — the developer is split 60% Sabbour family, 40% National Bank of Egypt. It said last year it was in the final stages of selecting an IPO advisor by June 2025.

The World Bank greenlit USD 1 bn in concessional financing for Egypt under the second phase of its Growth Development Policy Financing program — USD 800 mn from the bank, USD 200 mn as a UK credit guarantee — bumped from a planned USD 500 mn. The increase came “given the uncertainty in the region and the shock facing Egypt,” Country Director Stephane Guimbert told our Egypt desk.

Sound smart: Unlike project lending, DPF flows straight into the state budget once agreed reforms are taken care of. This tranche covers governance of state-owned enterprises, domestic debt market efficiency, fair competition rules, and welfare reforms.

Global commodities giant Trafigura is going upstream in Egypt aluminum. The commodities trader signed a term sheet to take a minority stake in a new project company with Metallurgical Industries Holding and Egyptalum, funding a USD 750-900 mn doubling of the Naga Hammadi complex to 600k tpa via a 300k tpa primary smelter and a 150k tpa anode plant. Trafigura comes in across the stack: minority equity, debt provider, long-term offtake, and alumina-feedstock supplier — the full-spectrum trader play.

Why it matters: Egypt currently imports all its alumina, so the agreement locks in 25-year supply at a moment when the International Aluminium Institute projects 40% demand growth by 2030, with EVs alone accounting for 63% of the increase. Our friends at EFG Hermes were sole financial advisor.

Bahrain’s aluminum champion also has eyes on Egypt. Back in September, MIH and Egyptalum signed a non-binding MoU with Aluminium Bahrain (Alba) to study a USD 3 bn alumina refinery with a target capacity of around 2 mn tpa. The fate of the project remains unclear in view of both Bahrain’s financial distress and the ongoing war in the Gulf.

Also worth knowing this morning-

Aldar Properties sits inside a record year for hybrid bonds, with the Abu Dhabi developer having printed two hybrid issuances so far in 2026. Hybrids — instruments rating agencies count partly as debt and partly as equity, letting issuers raise capital without spiking leverage ratios — have sold a record USD 65 bn globally YTD, with spreads at all-time lows of 58 bps in March, per Bloomberg data.

Cairo-based Beltone Venture Capital and Citadel International Holdings cashed out of Egyptian last-mile logistics player Bosta at a 75% IRR — buyer and valuation undisclosed, per the Beltone release (pdf). Bosta is preparing a USD 170 mn EGX listing later this year, so the open question is whether the undisclosed buyer is positioning ahead of the float or transacting a clean pre-IPO secondary.

The National Bank of Egypt bought a 20% stake in Scatec‘s USD 600 mn Obelisk solar-plus-storage project in Nagaa Hammadi, joining Norfund and EDF Power Solutions at the operating-company level at 20% each, per the Scatec statement. For NBE, the swap from debt provider to equity owner in the renewables stack is the move worth watching. Matouk Bassiouny & Hennawy advised.

Market Snapshot

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