Saudis took to Twitter to celebrate Aramco’s valuation hitting $2 trillion on Thursday, with one posting praising de-facto leader Crown Prince Mohammed bin Salman as a fortune teller, Reuters reports.
“Few people have the ability to predict the future,” journalist Mosaed al-Zayani posted on Twitter, a platform favoured for pro-government commentary in Saudi Arabia.
“He (the Saudi crown prince) said years ago Aramco’s valuation was $2 trillion and today it is the first company in the world to exceed this number,” al-Zayani added.
Saudis shared photos and videos of the crown prince, who made the IPO the centrepiece of his plan to diversify the kingdom’s economy away from oil and open up its society.
Although the world’s most profitable company fell short of the royal target during its long-awaited initial public offering (IPO) process, it finally crossed the line on Thursday as shares racked up a second day of gains.
Local media headlines included “A dream come true” and “Aramco at the top of the world” after the stock’s debut.
Amid patriotic fervour in the lead-up to the IPO, Saudis had clamoured to own part of the kingdom’s “crown jewel”, with more than 5 million retail subscribers.
Riyadh had scrapped a planned international roadshow last month after foreign investors questioned the sought valuation, and earlier ditched plans for a blockbuster international IPO.
Nevertheless, Saudi energy minister Prince Abdulaziz bin Salman had predicted Aramco’s valuation would rise after initial trading, telling Reuters last week that investors who stayed away would be “chewing their thumbs”.
“The $2 trillion valuation is not a dream,” Saudi economist Fadl Alboainain said, adding: “The government accepted a lower valuation to fast-track the IPO and placed a winning bet on market valuation for the company”.
Some market professionals have called the IPO as the biggest migration of private sector money to government pockets, but the government plans to locally invest most of the 96 billion riyals raised, its finance minister said this week.
Yet while the government hails the listing as a milestone for delivering on promises to diversify the economy, a potential drop in Aramco’s share price risks shaking domestic support.
“The danger is that if this doesn’t prove to be long-term sustainable and the share price starts reversing, the easy popularity can disappear as fast as it comes,” said Charles Hollis, director at intelligence consultancy Falanx Assynt.
“It’s clearly good for the crown prince but we have to see whether it lasts,” Hollis said, adding that it would not solve unemployment or poverty in some parts of the kingdom.