EFSIM Facilities says IPO is for growth, not valuation

• IPO launches next month
• Offering 30% of capital
• ‘Opportunity to inject capital’

The chief executive of EFSIM Facilities Management Company told AGBI the company is seeking “pure growth capital” from an initial public offering on the Saudi Exchange next month, pressing ahead even as the benchmark Tadawul exchange has underperformed this year.

EFSIM launched its prospectus on Tuesday, offering 16.8 million shares representing 30 percent of its capital on the main market. The company offers a range of facilities management services including cleaning, catering, waste collection and building contracting.

Despite fluctuations in the market this year – the Tadawul All-Share Index has fallen 11.5 percent since January 1 – CEO Tariq Chauhan said the company’s decision to go public supports its wider expansion plans.

“It’s not about the timing of the IPO,” he said. “It’s not the valuation that matters to us. We believe there is a good opportunity to inject capital and take advantage of the very good opportunities that are there.”

Nine companies have listed on the main market this year, raising a combined $3.3 billion. Of those, only two – Mecca-based developer Umm Al Qura for Development and Construction and gym operator Sports Club Company – were trading above their IPO price as of Tuesday.

The Tadawul was the worst-performing bourse in the region in the first three quarters of 2025. Analysts have cited restrictions on foreign investors and a lack of “exciting” IPOs as reasons for the market’s poor run of form.

By comparison, the DFMGI, the general index that tracks the Dubai Financial Market, has increased 13 percent since the start of the year.

The Saudi Exchange has indicated it intends to lower restrictions on foreign investors and raise the cap on foreign ownership of listed companies to ease capital inflows from abroad. Announcement of the changes were accompanied by jumps in the market. 

Chauhan said Efsim has recorded consistent double-digit growth since it launched in Saudi Arabia in 2009. According to its prospectus, EFSIM made SAR51 million ($13.6 million) profit last year with a gross profit margin of 14 percent.

It is now looking to expand through investing in technology upgrades, capital intensive activities – including facade cleaning and waste management services – and accommodation upgrades for its staff in Riyadh and Jeddah.

“Saudi Arabia has reached a very mature stage in facilities management and now it is evolving,” he said. “Everyone has now adopted facility management.”

Of the company’s SAR803 million in revenue for FY2024, 49 percent came from giga-projects, according to the prospectus.

This year, the Saudi government has indicated that it was looking to reduce spending on big-ticket infrastructure projects and seek more private sector investment.

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Chauhan said that EFSIM has been “not at all impacted” by cuts and that it maintained a backlog of SAR1.8 billion in contracts as of March 31. Spending cuts are unlikely to hit EFSIM, he said, which largely pursues long-term contracts on completed projects.

“These are ready projects,” said Chauhan. “We are not expecting any slowdown.”

The company is also looking to increase its hold on other sectors of the economy, including services for aviation, which accounted for 22 percent of revenue last year, commercial, which accounted for 9.4 percent, and oil and gas, which accounted for 9 percent.

“It is not only about gig-aprojects,” he said. “There is a perception that Saudi Arabia is all about giga-projects, but there is a lot more happening.”