Flynas, Saudi Arabia's budget airline, under the leadership of Chief Executive Bander Al Mohanna, has unveiled plans for an initial public offering (IPO) later this year, intending to list its shares on the Tadawul stock exchange.
During the Airline Economics Growth Frontiers Conference in Riyadh, Al Mohanna confirmed these intentions. Alongside this, Flynas is eyeing an expansion of its network, aiming to acquire 30 widebody aircraft. The company has already initiated the procurement process through a request for proposal (RFP), with the winning bid expected to be announced and finalized within the year.
Currently, Flynas, partially owned by Kingdom Holding, operates with a fleet comprising 64 Airbus aircraft and conducts approximately 1,500 flights weekly. Notably, the airline's financial performance was disclosed for the first time, revealing a consistent profitability trend since 2015, with a notable 32 percent annual revenue increase, amounting to SAR 6.3 billion ($1.68 billion) in 2023, despite the disruptions caused by the COVID-19 pandemic.
This strategic move towards an IPO aligns with Saudi Arabia's broader agenda to bolster its aviation sector, aiming to accommodate 330 million passengers and enhance connectivity to 250 destinations by 2030. Flynas enlisted the expertise of financial giants like Goldman Sachs Group, Morgan Stanley, and Saudi Fransi Capital for its IPO preparations in late 2023.
The aviation landscape in Saudi Arabia has witnessed significant growth, as evidenced by data from the General Authority of Civil Aviation (GACA), indicating a 16 percent increase in flights to 814,995 and a rise in destinations to 148 in 2023. Passenger numbers surged by 26 percent to 112 million, with low-cost carriers capturing a substantial market share of 44 percent and nearly doubling their overall market share to 32 percent.
Flynas' IPO aspirations coupled with its expansion plans reflect the airline's commitment to capitalizing on the burgeoning aviation market in Saudi Arabia, amidst ambitious government initiatives aimed at transforming the nation into a global aviation hub.
