The first major IPO in Saudi Arabia since the outbreak of the Iran war has been scrapped, in a sign that investors remain cautious about the outlook for regional businesses with the conflict still unresolved after more than 100 days. Mutlaq Al-Ghowairi Contracting Co said it had attracted enough demand to cover its $799 million share sale, but decided to pull the offering after “careful consideration of the objectives and strategic priorities” of the firm and its owners.

While the Saudi bourse has recovered since the outbreak of the war at the end of February, bankers in the country say investors remain wary about its full impact and the effect of government spending cuts on the economy. Even before the war, there were signs of fatigue. Listing volumes dropped in 2025 and several other firms abandoned IPO plans.

Saudi Arabia needs a buoyant stock market. It has a large pipeline of firms looking to go public, and the market has become a significant part of the government and the sovereign wealth fund’s strategy to raise money by selling stakes in existing companies to reinvest in new ventures.