Tadawul expects foreign funds to ease Aramco listing: Al Hussan

The Saudi Stock Exchange (Tadawul) is expecting an improved inflow of foreign funds to smooth the listing of state-owned Saudi Aramco, Reuters reported, citing CEO Khalid Al Hussan.

His comments come after some analysts raised concerns on whether Tadawul alone can absorb the 5 percent floatation of Aramco, expected to raise $100 billion.

“Foreign investors are putting in more money — every day we have improved liquidity capacity,” Al Hussan said.

“What we have seen at the beginning of this year from foreign investor participation and the cash inflows and the number of registered QFIs in the market, gives us a very comfortable state,” he added.

Last month, Tadawul was included in the FTSE Russell emerging market index and will join starting March next year. Expectations are high that the exchange will also be included in MSCI’s Emerging Market Index this year.

Investment bank EFG Hermes estimates Saudi Arabia is likely to see fund inflows totaling $30 billion to $45 billion in the next two years if it reaches the foreign ownership levels of markets such as the UAE.

Separately, Al Hussan said the Tadawul is fully prepared to handle the Aramco IPO alone, if necessary.

In addition to Riyadh, the government plans to list Aramco on one or more foreign markets such as New York, London and Hong Kong.