Nice One e-commerce platform to float IPO on Saudi exchange

Nice One Beauty Digital Marketing Company (Nice One), the leading e-commerce platform in Saudi Arabia focused on beauty and personal care products, has announced its intention to proceed with an initial public offering (IPO) and list its shares on the Main Market of the Saudi Exchange (Tadawul).

The IPO follows the approval of the company’s application by the Saudi Capital Market Authority (CMA) on September 25, allowing the company to offer a total of 34,650,000 ordinary shares.

These shares comprise 29,150,000 existing shares (sale shares) and 5,500,000 newly issued shares (new shares), representing 30 per cent of the company’s post-IPO share capital.

Upon completion of the offering, the sale shares will account for 25.24 per cent of the company’s capital, while the new shares will contribute 4.76 per cent.

The funds raised from the offering will be used to support the company’s growth initiatives, including working capital, development and marketing of its brands, enhancing logistical and technical capabilities, and advancing its business objectives.

The final offering price will be determined following a book-building process, with shares to be allocated to institutional investors and retail subscribers.

Company overview

Founded in 2017, Nice One has rapidly grown to become the largest online platform for beauty and personal care products in Saudi Arabia.

Offering more than 28,000 products from more than 1,200 global and local brands, the platform serves millions of customers across the kingdom.

Nice One specialises in cosmetics, skincare, haircare, fragrance, and nutritional supplements, with its primary sales channel being its highly popular app, which accounts for 95 per cent of sales as of Q1 2024.

The company has built a strong brand reputation, with over eight million app downloads and a 90 per cent customer satisfaction rate.

Nice One’s robust logistics infrastructure, including its main warehouse in Riyadh and company-owned transportation fleet, ensures seamless delivery across the kingdom. In addition, the company’s advanced IT infrastructure is hosted on Amazon Web Services (AWS), ensuring high platform reliability and operational efficiency.

Nice One’s financial performance

Nice One has seen remarkable growth in recent years. For FY 2023, the company recorded revenue of SAR 782.4m, with a net income of SAR32.6m. In Q1 2024, revenue surged by 61.2 per cent year-on-year, reaching SAR250.1m, while net income increased by an impressive 146.6 per cent to SAR21.9m. The Nice One’s EBITDA margin also grew significantly, from 4.5 per cent in FY 2021 to 10.2 per cent in Q1 2024, demonstrating its strong cost efficiency and scalability.

Statements from the founders

Omar Al Olayan, CEO and co-founder of Nice One, expressed his pride in the company’s journey, stating, “This IPO marks a significant milestone in Nice One’s journey. It reflects the dedication and hard work of everyone involved since we founded the company in 2017.

“We have consistently innovated and adapted, scaling the business in a dynamic marketplace. As we move forward, we are excited to expand our reach and continue delivering world-class products and services to our customers.”

Abdularahman Al Olayan, CMO and co-founder, echoed these sentiments, emphasising the company’s commitment to growth, digital transformation, and alignment with Saudi Arabia’s Vision 2030. “The IPO represents a pivotal moment in Nice One’s journey. As we enter this new phase, we aim to enhance our investments in digital transformation, broaden our market impact, and deliver sustainable returns for our shareholders,” he said.

Bookrunners and underwriters

In preparation for the IPO, Nice One has appointed EFG Hermes KSA and SNB Capital Company as joint financial advisors, bookrunners and underwriters for the offering.

The duo will oversee the book-building process and manage the sale of shares to institutional investors. Additionally, SNB Capital has been appointed as the lead manager for the offering.

Other leading financial institutions, including SAB Invest, Al Rajhi Capital, Saudi Fransi Capital, Alinma Investment, Riyad Capital, AlJazira Capital, and several others, have been designated as receiving agents to assist with retail subscriptions.

Looking ahead

Nice One is positioned to capitalise on the growing beauty e-commerce sector in Saudi Arabia. With a strong digital platform and brand offerings, the company is poised for continued success and growth.

The offering is set to bring additional capital, which will be reinvested into the company to further its market position and support its long-term strategic goals.

Interested investors will have the opportunity to subscribe to shares through multiple channels, including the 10 per cent allocation reserved for retail investors, provided there is sufficient demand.

Key IPO highlights: At a glance

• Offering size: 34,650,000 ordinary shares, representing 30 per cent of the company’s post-offering share capital.
• Shares allocation: The shares will be allocated to both institutional investors and retail subscribers, with a maximum of 3,465,000 shares reserved for retail investors, representing 10 per cent of the total offering.
• List and trade: The shares will be listed and traded on the Saudi Exchange’s Main Market after the completion of the offering process and necessary approvals.