Saudi Arabia's low-cost airline Flynas on Tuesday confirmed plans to list its shares on the Tadawul stock exchange this year, amid the kingdom's ambitions to grow its aviation sector and a boom in initial public offerings in the country.
Flynas, which is backed by billionaire businessman Prince Alwaleed bin Talal, recorded a 32 per cent annual increase in revenue to reach 6.3 billion Saudi riyals ($1.68 billion) in 2023, its chief executive Bander Al Mohanna told the Airline Economics conference in Riyadh.
The carrier revealed its financial results for the first time ahead of the anticipated IPO.
Flynas, which was established in 2007, has recorded profits every year since 2015 with the exception of the Covid-19 pandemic period, Mr Al Mohanna said.
The airline has also issued a request for proposals to purchase 30 wide-body aircraft, with the winning offer expected to be announced and signed this year, he added.
The all-Airbus operator has a fleet of 64 aircraft, operates 1,500 flights per week and serves more than 70 domestic and international destinations, according to its website.
Flynas began operations as Nas Air in 2007 and is partly owned by Kingdom Holding, the investment vehicle of Prince Alwaleed.
The move to list the low-cost airline comes amid Saudi Arabia's broader aviation sector strategy that seeks to unlock $100 billion in private and government investment across the kingdom’s airports, airlines and aviation support services.
As part of the strategy, the kingdom aims to welcome 330 million passengers, ensure connectivity with 250 destinations and develop cargo capacity of 4.5 million tonnes by 2030.
Under that plan, it established the new carrier Riyadh Air that will begin operations next year.
In 2023, Saudi Arabia expanded its air connectivity to reach 148 destinations, according to the latest data from the country's General Authority of Civil Aviation (Gaca).
Flights increased 16 per cent year-on-year to 814,995 in 2023, while the number of passengers increased 26 per cent on an annual basis to 112 million last year, well above pre-pandemic levels, Gaca said.
Low-cost carriers drove the most growth in passenger traffic, increasing domestic market share from 27 per cent before the pandemic to 44 per cent in 2023, the data showed.
Internationally, the low-cost carriers' market share has also doubled from 16 per cent before the pandemic to 32 per cent in 2023.
The listing of Flynas also comes amid a surge in IPOs in Saudi Arabia amid rising investor demand.
Companies raised $3.5 billion on the Saudi exchange through 35 offerings last year, recording the highest number of IPOs in the GCC during 2023 and 35 per cent of the total proceeds, according to data from Kamco.
The momentum is expected to continue this year, according to the head of the kingdom’s Capital Markets Authority.
There were 56 big and small companies considering listings on Tadawul’s Main Market and its Nomu-Parallel trading platform, a 30 per cent increase from the same period last year, CMA chairman Mohammed El Kuwaiz said at the Saudi Capital Market Forum in Riyadh in February.
The IPO momentum carried over into 2024 from the past three years indicates “Saudi Arabia is encountering the proposition of transforming from a net exporter of capital to a net importer of capital”, he said.
