Apple has been taken down by Saudi Aramco as the most valuable company

Saudi Arabia’s oil company Aramco overcame Apple as the world’s most valuable public company on Wednesday, when its shares debuted on the Saudi stock exchange, part of the ambitious shift away from the very fossil fuels that the country’s economy depends on.

The 10% rally of the shares on their trading debut brought the value of state-owned Aramco to US$ 1.88 trillion ($2.73 trillion). 1.5 per cent of the company listed has raised US$ 25.6 billion, a record for the initial public offering. Apple was priced at $US1.19 trillion at the end of Tuesday in the U.S.

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The Saudi Crown Prince Mohammed bin Salman has made Aramco’s initial public offering (IPO) the centrepiece of his vision of diversifying the Kingdom’s economy away from its dependence on oil; he will use the $25.6 billion raised in the primary offering to develop other sectors.

Since its trading debut on Wednesday, Aramco’s share price has already soared 20.6 per cent from the 32 Riyals ($8.53) that the stock was sold for in the record-breaking initial public offering. Saudi Aramco’s shares began trading on Saudi stock exchange Tadawul on Wednesday after the energy behemoth raised money in the world’s biggest initial public offering.

The $2 trillion valuations have been a priority for the crown prince since he first claimed partial privatisation in 2016. Still, many analysts saw the figure as a stretch despite Aramco’s monopoly on oil production in Saudi Arabia, the world’s largest crude exporter.

Bernstein Research analysts said Thursday that the estimate of $2 trillion was “too much, too early” despite slow expected earnings growth and low global oil prices upside. Compared to peers like Exxon and Royal Dutch Shell, the company looks expensive, they said.

Sriyansa Mohanty
Author: Sriyansa Mohanty

From India. A student who loves blogging about technology.

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