On October 16, 2025, shareholders of Shams Tourism Projects Company convened for an extraordinary general assembly meeting—a gathering that would set off a chain of events rippling through the Saudi stock market. The company, known in the local press as "Shams," put forth a proposal that, at first glance, seemed little more than a technical adjustment: to change the nominal value of its shares from 0.5 Saudi Riyals to 10 Riyals. But as the dust settled, the impact of this decision became clear—not just for Shams, but for the broader Tadawul All Share Index and investors across the Kingdom.
According to a statement published by Shams on the Saudi stock exchange platform, the decision was approved by a clear majority. The move would see the number of company shares drop dramatically, from approximately 1.156 billion to just under 57.8 million, with each share now carrying a much heftier price tag. Despite the seismic shift in share count and nominal value, the company emphasized that its overall capital would remain unchanged. "There will be no change in the company’s capital before and after the share adjustment," Shams stated in its official communication, echoing assurances repeated across multiple financial news outlets.
This technical maneuver—known in financial circles as a reverse stock split—may sound like accounting sleight of hand, but it carries real implications for everyone involved. Shareholders who owned stock as of the meeting date, and who were registered with the Securities Depository Center (Edaa) by the end of the second trading day after the assembly, would be directly affected. The company clarified that the share price would be adjusted to reflect the new nominal value starting from the next trading day, while the change in the number of shares in investors’ portfolios would show up by the end of the second trading day following the assembly. It’s a bit of a waiting game, but one with clear rules.
For those keeping a close eye on the Tadawul All Share Index, the ramifications were immediate. On the day of the assembly, the index recorded a drop of 0.5 points, falling to just 10 points. Prior to the adjustment, the index’s value was reported at 57,823 million Saudi Riyals, but after the change, it ballooned to approximately 1.156 billion Riyals—a figure that mirrors the pre-adjustment share count of Shams. The numbers, while dizzying, tell a story of recalibration rather than outright loss or gain.
Market watchers noted that the trading volume on October 16, 2025, took a noticeable dip compared to previous days. The market value and trading volume hovered in the range of 7 to 8 million Saudi Riyals, reflecting a cautious mood among investors. As reported by local news outlets, "the trading volume recorded on October 16, 2025, showed a decline compared to previous trading days." It’s not uncommon for such technical adjustments to cause market participants to pause and reassess their positions, at least temporarily.
Fast forward to October 19, 2025, and the financial press was still abuzz with analysis. A report published that morning at 08:19 AM reiterated the key details: the Tadawul All Share Index had dropped by 0.5 points, the index was now at 10 Saudi Riyals, and the total market capitalization had shifted from 1,156,472,460 Riyals before the drop to 57,823,623 Riyals after. Yet, as several sources pointed out, "no change in market value was recorded before and after the index drop." The numbers may have changed on paper, but the underlying value remained steady—a point the company and market regulators were keen to stress.
Behind the scenes, the decision was shepherded by Shams’s leadership. The assembly was attended by Chairman Khalid bin Abdulaziz Al-Bawardi and a roster of board members, including Abdullah bin Omar Al-Suwailim (Vice Chairman and Managing Director), Rashid bin Suleiman Al-Rashid, Dr. Wael bin Saad Al-Rashid, Badr bin Hamad Al-Qadhi, Wael bin Abdulrahman Al-Bassam, and Ziad bin Ibrahim Al-Afalq. Committee heads present included Rashid bin Suleiman Al-Rashid (Audit Committee), Dr. Wael bin Saad Al-Rashid (Nominations and Remunerations Committee), and Abdullah bin Omar Al-Suwailim (Development and Investment Committee). Their collective stewardship ensured the process followed both regulatory requirements and best practices in governance.
As part of the assembly’s business, amendments were made to Article 7 (concerning capital) and Article 8 (concerning share subscriptions) of the company’s bylaws. These changes, while technical in nature, were necessary to reflect the new share structure and to ensure compliance with Saudi corporate law. The company was clear in its communications: "The decision will be effective for all shareholders owning shares on the day of the extraordinary general assembly and listed in the company’s shareholder register with Edaa at the end of the second trading day following the assembly." The effects on share price would be immediate, but the administrative changes would take a couple of days to filter through the system.
Market analysts were quick to weigh in on the broader implications. Some saw the move as a way for Shams to streamline its share structure, potentially making its stock more attractive to institutional investors. Others noted that such adjustments can sometimes be a signal that a company is preparing for larger strategic shifts—whether that means new investments, partnerships, or even a future public offering. "Adjusting the nominal value of shares and reducing the number of outstanding shares can help clarify the company’s market position and simplify its capital structure," one analyst observed in a televised interview.
Yet, for everyday investors, the immediate concern was the effect on their portfolios. Would the new share price accurately reflect the company’s underlying value? Would the reduced liquidity in the market make it harder to buy or sell shares? And what about the psychological impact of seeing a portfolio’s share count suddenly shrink, even if the total value remains unchanged? These are not trivial questions, and they speak to the heart of investor sentiment in a market that is still evolving and maturing.
For Shams, the next few weeks will be crucial. The company will need to maintain clear and transparent communication with its shareholders, many of whom may be unfamiliar with the mechanics of reverse stock splits. Regulators, too, will be watching closely to ensure that the process remains fair and that no group of investors is disadvantaged. As the Tadawul All Share Index adjusts to the new reality, the broader market will be looking for signs of stability—and perhaps even opportunity—in the wake of these changes.
In the end, the technicalities of share nominal value and market capitalization may seem arcane, but they have very real consequences for companies, investors, and the market as a whole. As the Saudi market continues to modernize and attract global attention, such episodes serve as reminders of the importance of transparency, good governance, and investor education. The story of Shams’s share adjustment is just one chapter in a much larger narrative—one that’s still being written on the trading floors of Riyadh and beyond.