The Public Investment Fund (PIF) brought in SAR 64 billion (USD 17 billion) in net profits during the last year.
This is in contrast to a net loss of SAR 17 billion riyals (USD 4.5 billion) in 2022.
Solid Performance
The consolidated financial statements of the Kingdom’s sovereign wealth fund, published on the London Stock Exchange’s website, showed a more than 100% increase in its revenues during 2023.
Revenues totaled SAR 331 billion riyals (USD 88.5 billion) on the back of growth in the market value of its investment portfolio.
This has bolstered its contribution to driving the country’s economic transformation in line with “Vision 2030.”
So What
The assets of PIF rose to SAR 3.7 trillion (USD 990 billion) by the end of last year.
This is compared to SAR 2.9 trillion during the same period in 2022.
This increase is attributable to several acquisitions PIF undertook during the period, as well as the inflow of 16% of oil giant Aramco’s shares to the fund’s portfolio.
The fund aims to amass assets totaling USD 3 trillion by 2030.
The investment portfolio of the fund includes investments in major mining and telecommunications companies, as well as in both the domestic and global sporting sectors.
It also holds significant stakes in video game companies and electric car manufacturing firms.
Additionally, the fund is involved in developing new areas such as NEOM, Diriyah Gate, Qiddiya, as well as Riyadh’s new square, New Square in Riyadh, the Red Sea Islands, and the “Roshn” residential projects.
Some Context
2023 also saw PIF strengthen its strategy to diversify its funding sources through debt instrument issuances.
During this period, it raised an additional SAR 45 billion riyals (USD 11.9 billion).
Some of its portfolio companies also secured funding for several acquisitions, given PIF’s strategy to diversify its financing.
These include loans, debt instruments, investment profits, capital injections from the government, and government assets transferred to it.
Now What
The Public Investment Fund was the most active sovereign fund in the world during the first six months of this year.
It benefited from the transfer of government assets to it, according to consultancy firm Global SWF.
The renowned firm also revealed that investments by Gulf sovereign wealth funds exceeded half of the world’s sovereign investments in the first half of 2024.
Thus, their investments jumped to “their highest levels” in about 15 years.
The investments of oil-rich Gulf sovereign funds, led by the Public Investment Fund, accounted for 54% of the total global investments amounting to USD 96 billion.
This is the “largest share” since 2009, reflecting the importance of Middle Eastern sovereign funds for global capital flows.
Collectively, these funds manage assets exceeding USD 4 trillion in value, given that the region has attracted an increasing number of bankers, investment moguls, and technology sector leaders from around the world.
This is to support acquisitions, raise new funds, or finance their investment plans over the past few years.
