Saudi Arabia’s biggest airline and another shareholder will list a 30% stake in cargo firm SAL Saudi Logistics Services Co. in a Riyadh initial public offering, as the kingdom’s market for listings picks up after a slow start to the year.

Saudi Arabian Airlines Corp., also known as Saudia, and Tarabot Air Cargo Services Ltd. are offering 24 million shares in the cargo firm in the Tadawul listing, according to a statement on Tuesday. Saudia currently owns 70% of SAL while Tarabot owns 30% of the firm.

The bookbuilding period for institutional investors will run from Sept. 25 to Oct. 1 while retail buyers will be able to place orders from Oct. 11 to Oct. 13, according to SAL’s prospectus.

SAL joins a growing pipeline of companies looking to list in the Persian Gulf’s biggest market, buoyed by a 12% rally in the benchmark index since a March low on more stable oil prices and optimism from earnings. 

Oil driller ADES Holding Co., backed by the kingdom’s sovereign wealth fund, started taking investor orders for its IPO of as much as $1.2 billion on Sunday, set to be Saudi Arabia’s biggest of the year. Meanwhile car rental firm Lumi Rental Co. drew orders of about $27 billion for its $290 million listing last week, underscoring continued appetite for Saudi share sales.

ADES alone will more than double Saudi Arabia’s current IPO haul so far this year of $901 million, which is less than a fifth of the proceeds in the year-ago period, data compiled by Bloomberg show.

SAL is the leading cargo handling player in Saudi Arabia with a roughly 95% market share and also handles transit and export shipments. The company had revenue of 1.22 billion riyals ($325 million) in 2022 and net income of 362 million riyals. In the first half of this year, SAL posted revenue growth of 15% year-on-year.

Expansion Plans 

Saudi Arabia has outlined an ambition to become a global supply chain hub and develop one of the largest airports in the world in Riyadh, as part of its plans to diversify the economy.

HSBC Holdings Plc’s Saudi unit has been appointed as sole financial advisor, bookrunner, global coordinator, lead manager and underwriter for the IPO.