{"id":83457,"date":"2025-09-22T10:27:18","date_gmt":"2025-09-22T07:27:18","guid":{"rendered":"https:\/\/amlak.net.sa\/?p=83457"},"modified":"2025-11-25T17:40:49","modified_gmt":"2025-11-25T17:40:49","slug":"%d8%aa%d9%81%d8%a7%d9%88%d8%aa-%d8%a7%d9%84%d9%82%d9%8a%d9%85%d8%a9-%d8%a7%d9%84%d8%a7%d8%b3%d9%85%d9%8a%d8%a9-%d9%84%d9%84%d8%a3%d8%b3%d9%87%d9%85-%d8%a8%d9%8a%d9%86-%d8%ad%d8%b1%d9%8a%d8%a9-%d8%a7","status":"publish","type":"post","link":"https:\/\/amlak.net.sa\/en\/83457\/","title":{"rendered":"Variation in the nominal value of stocks: Between corporate freedom and market transparency"},"content":{"rendered":"

Variation in the nominal value of stocks: Between corporate freedom and market transparency<\/span><\/h4>\n

Dr.. Dr. Abdulhakim bin Abdullah Al-Kharji<\/strong><\/p>\n

With the development of the Saudi capital market and the expansion of the base of listed companies, it has become noticeable that some companies have adopted a different nominal value for shares than usual, as some companies offer their shares with a nominal value (1 riyal), while the majority still have a nominal value (10 riyals). Although this diversity reflects legislative flexibility aimed at enabling companies to diversify their financing tools, it raises legal and investment issues that affect the principle of transparency and clarity of information for investors, on the other hand, it raises legal and investment issues that affect the principle of transparency and clarity of information for investors.<\/p>\n

First: The importance of face value<\/strong><\/span><\/h4>\n

The par value is not just a number, but a basic accounting unit that reflects part of the company's capital and is based on several financial indicators, such as earnings per share and earnings per share, as well as a basic reference in determining distributions, reserves, and the amount of paid-up capital.<\/p>\n

II: Negative effects of varying nominal values<\/strong><\/span><\/h4>\n
    \n
  1. Confusion in interpreting the market price<\/strong><\/li>\n<\/ol>\n

    A novice investor may be attracted to a stock priced at 12 riyals, thinking it is undervalued, without realizing that its face value is 1 riyal, while ignoring another stock priced at 19 riyals with a face value of 10 riyals, even though the latter has a lower market value<\/p>\n

      \n
    1. Lack of awareness and adequate disclosure<\/strong><\/li>\n<\/ol>\n

      Many trading platforms do not clearly show the par value, which impairs an investor's ability to evaluate a stock on its financial fundamentals.<\/p>\n

        \n
      1. Unfairness among companies<\/strong><\/li>\n<\/ol>\n

        Companies with a lower par value have artificial price attractiveness, even though the strength of a company is measured by its financial statements and not its stock price alone.<\/p>\n

        III: Legal Vision and Organizational Proposals<\/strong><\/span><\/h4>\n

        - The principle of a level playing field between companies and traders requires the standardization or regulation of the par value standard.<\/p>\n

        - According to the disclosure and transparency policies stipulated in the Capital Market Law and CMA regulations, it is the duty of the competent authorities to clarify all factors affecting the investment decision, including the nominal value.<\/p>\n

        IV: Practical recommendations<\/strong><\/span><\/h4>\n
          \n
        1. Standardize the nominal value of the listed shares, whether it is 1 riyal or 10 riyals.<\/li>\n
        2. Or requiring trading platforms to display the stock's par value next to the market price.<\/li>\n
        3. Launching awareness campaigns for investors to explain the difference between par value and market value and its impact on their decisions.<\/li>\n<\/ol>\n

          The freedom of companies to determine their financial structure is legitimate and desirable, but it should not be at the expense of information clarity and market transparency.<\/p>\n

          If the primary mission of the financial market is to \u201cenable informed investment\u201d, then fair regulation of par value is one of the doors to realizing this mission and ensuring the integrity of the market.<\/p>\n

          \u00a0@Dr_alkharji<\/strong><\/p>","protected":false},"excerpt":{"rendered":"

          Reading time: <\/span> 2<\/span> Minutes<\/span><\/span>\u062a\u0641\u0627\u0648\u062a \u0627\u0644\u0642\u064a\u0645\u0629 \u0627\u0644\u0627\u0633\u0645\u064a\u0629 \u0644\u0644\u0623\u0633\u0647\u0645: \u0628\u064a\u0646 \u062d\u0631\u064a\u0629 \u0627\u0644\u0634\u0631\u0643\u0627\u062a \u0648\u0634\u0641\u0627\u0641\u064a\u0629 \u0627\u0644\u0633\u0648\u0642 \u062f. \u0639\u0628\u062f\u0627\u0644\u062d\u0643\u064a\u0645 \u0628\u0646 \u0639\u0628\u062f\u0627\u0644\u0644\u0647 \u0627\u0644\u062e\u0631\u062c\u064a \u0645\u0639 \u062a\u0637\u0648\u0631 \u0627\u0644\u0633\u0648\u0642 \u0627\u0644\u0645\u0627\u0644\u064a\u0629 \u0627\u0644\u0633\u0639\u0648\u062f\u064a\u0629 \u0648\u062a\u0648\u0633\u0639 \u0642\u0627\u0639\u062f\u0629 \u0627\u0644\u0634\u0631\u0643\u0627\u062a \u0627\u0644\u0645\u062f\u0631\u062c\u0629\u060c \u0623\u0635\u0628\u062d \u0645\u0646 \u0627\u0644\u0645\u0644\u0627\u062d\u0638 \u0627\u0639\u062a\u0645\u0627\u062f \u0628\u0639\u0636 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more<\/a><\/p>","protected":false},"author":10,"featured_media":79219,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_seopress_robots_primary_cat":"0","_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","footnotes":""},"categories":[120],"tags":[],"class_list":["post-83457","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-capital-markets"],"acf":{"amlak_post_excerpt":"\u0623\u062b\u0631 \u0627\u062e\u062a\u0644\u0627\u0641 \u0627\u0644\u0642\u064a\u0645\u0629 \u0627\u0644\u0627\u0633\u0645\u064a\u0629 \u0628\u064a\u0646 1 \u064810 \u0631\u064a\u0627\u0644\u0627\u062a \u0639\u0644\u0649 \u0648\u0636\u0648\u062d \u0627\u0644\u0645\u0639\u0644\u0648\u0645\u0627\u062a \u0644\u0644\u0645\u0633\u062a\u062b\u0645\u0631\u064a\u0646 \u0648\u0633\u0628\u0644 \u062a\u0646\u0638\u064a\u0645\u0647","amlak_post_excerpt_source":{"label":"Amlak post 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