Under Islamicly's Shariah framework, shares in a listed company may be considered permissible to own and trade when two conditions are met. The underlying business activity and the applicable financial criteria must both satisfy the Shariah screening methodology. That methodology is prescribed by AAOIFI standards and reviewed by Islamicly's globally renowned Shariah Supervisory Board.
Shariah Compliance in Saudi Arabia at a Glance
By number of securities
- Shariah-compliant381
- Non-compliant30
By market capitalisation
- Shariah-compliant92.5%
- Non-compliant7.5%
How Islamicly Screens a Stock
Islamicly applies three-level screening to every listed equity, aligned with AAOIFI Shariah Standard No. 21, with a fourth step governing the income that remains. A company must clear all three screens to earn a compliant rating.
| Screen | What It Requires |
|---|---|
| 1 · Business sector | Companies deriving 5% or more of revenue from alcohol, conventional finance, gambling, tobacco, pork, adult content or deferred gold/silver trading are excluded, as defined by AAOIFI and enhanced by the Islamicly Shariah Board. |
| 2 · Debt ratio | Interest-bearing debt must stay below 30% of the 36-month average market capitalisation. |
| 3 · Cash compliance | (Cash + interest-bearing securities) ÷ market value of equity, on a 36-month average, must be below 30%. |
| 4 · Purification | Any residual non-permissible income that was tolerated during the sector compliance check is purified by donating that proportion of dividends to charity. |
Purification applies to dividends, not capital gains.
View Islamicly's full screening criteriaTop 10 Stocks in Saudi Arabia by Market Capitalisation
1. Saudi Arabian Oil Company (Saudi Aramco)
Saudi Aramco is the Kingdom's state-controlled integrated energy and chemicals company and the world's largest oil producer by output, with operations spanning exploration, production, refining and petrochemicals. The Saudi government is its majority shareholder. A review of the revenue segments found no involvement in non-permissible business activities, with interest revenue below 5% of total revenue. The business sector screen therefore passes. The stock passes both debt compliance and cash compliance, and is classified Shariah-compliant.
| Business Activity | Debt Compliance | Cash Compliance |
|---|---|---|
| Pass | Pass | Pass |
Saudi Arabian Oil Company (Saudi Aramco) is classified Shariah-compliant.
2. Al Rajhi Banking and Investment Corporation
Al Rajhi Bank is one of the largest Islamic banks in the world by assets. It operates entirely on Shariah-compliant principles, with a large retail franchise across Saudi Arabia. Al Rajhi operates as a fully Islamic financial institution, and its banking services are Shariah-compliant. As per the Shariah screening methodology, Al Rajhi has a Shariah scholars board to supervise the activities of the bank. It also has a pronouncement from the Shariah board that the activities of the bank are Shariah-compliant. The stock therefore passes the business sector screen. It also passes debt compliance and cash compliance.
| Business Activity | Debt Compliance | Cash Compliance |
|---|---|---|
| Pass | Pass | Pass |
Al Rajhi Banking and Investment Corporation is classified Shariah-compliant.
3. Saudi National Bank
Saudi National Bank is the Kingdom's largest bank by assets, formed in 2021 through the merger of National Commercial Bank and Samba Financial Group. It offers retail, corporate and investment banking. Although SNB offers Shariah-compliant products alongside its conventional banking, its non-permissible income amounts to about 18.2% of total revenue, well above the 5% ceiling. It therefore fails the business sector screen. Debt compliance and cash compliance both pass, but a clean balance sheet cannot offset the business activity result.
| Business Activity | Debt Compliance | Cash Compliance |
|---|---|---|
| Fail | Pass | Pass |
Saudi National Bank is classified Shariah non-compliant.
4. Saudi Arabian Mining Company (Ma'aden)
Ma'aden is Saudi Arabia's largest mining company, producing phosphate fertilisers, aluminium and gold. It is central to the Kingdom's plan to develop mining as a third pillar of its industrial economy. Ma'aden reports no interest income and no involvement in non-permissible business activities. The business sector screen therefore passes. The stock passes both debt compliance and cash compliance, and is classified Shariah-compliant.
| Business Activity | Debt Compliance | Cash Compliance |
|---|---|---|
| Pass | Pass | Pass |
Saudi Arabian Mining Company (Ma'aden) is classified Shariah-compliant.
5. Saudi Telecom Company (stc)
stc is the largest telecommunications operator in Saudi Arabia, providing mobile, fixed-line, broadband and digital services to consumers, businesses and government, with operations across the region. A review of the revenue segments found one non-permissible stream — television services related to movies — but it stays below 5% of total revenue. The business sector screen therefore passes. The stock passes both debt compliance and cash compliance, and is classified Shariah-compliant.
| Business Activity | Debt Compliance | Cash Compliance |
|---|---|---|
| Pass | Pass | Pass |
Saudi Telecom Company (stc) is classified Shariah-compliant.
6. Saudi Basic Industries Corporation (SABIC)
SABIC is one of the world's largest petrochemical manufacturers, producing chemicals, polymers and agri-nutrients. Saudi Aramco acquired a 70% stake in the company in 2020. A review of the revenue segments found no involvement in non-permissible business activities, with interest revenue below 5% of total revenue. The business sector screen therefore passes. The stock passes both debt compliance and cash compliance, and is classified Shariah-compliant.
| Business Activity | Debt Compliance | Cash Compliance |
|---|---|---|
| Pass | Pass | Pass |
Saudi Basic Industries Corporation (SABIC) is classified Shariah-compliant.
7. ACWA Power Company
ACWA Power develops, invests in and operates power generation, desalinated water and green hydrogen plants across the Middle East, Africa and Asia. It is a lead developer in the Kingdom's renewable energy programme. A review of the revenue segments found no involvement in non-permissible business activities, with interest revenue below 5% of total revenue. The business sector screen therefore passes. The stock passes both debt compliance and cash compliance, and is classified Shariah-compliant.
| Business Activity | Debt Compliance | Cash Compliance |
|---|---|---|
| Pass | Pass | Pass |
ACWA Power Company is classified Shariah-compliant.
8. Dr. Sulaiman Al Habib Medical Services Group
Dr. Sulaiman Al Habib Medical Services Group is one of the largest private healthcare providers in the Middle East. It operates hospitals, medical centres and pharmacies in Saudi Arabia, the UAE and Bahrain. The company is not involved in non-permissible business activities. The business sector screen therefore passes. The stock passes both debt compliance and cash compliance, and is classified Shariah-compliant.
| Business Activity | Debt Compliance | Cash Compliance |
|---|---|---|
| Pass | Pass | Pass |
Dr. Sulaiman Al Habib Medical Services Group is classified Shariah-compliant.
9. Riyad Bank
Riyad Bank, founded in 1957, is one of Saudi Arabia's largest banks, providing retail, corporate, treasury and investment banking services. Riyad Bank is a conventional bank that also offers Shariah-compliant investment products. Because its annual report does not separate the two, the bank is assessed as a whole on the information available. Interest income makes up almost all of its reported revenue. It fails the business sector screen, and it also fails debt compliance and cash compliance.
| Business Activity | Debt Compliance | Cash Compliance |
|---|---|---|
| Fail | Fail | Fail |
Riyad Bank is classified Shariah non-compliant.
10. Alinma Bank
Alinma Bank, established in 2006, is a Saudi Islamic bank that conducts all of its banking and investment activities in accordance with Shariah principles. Alinma operates as an Islamic bank, and its banking services are Shariah-compliant. As per the Shariah screening methodology, Alinma has a Shariah scholars board to supervise the activities of the bank. It also has a pronouncement from the Shariah board that the activities of the bank are Shariah-compliant. The stock therefore passes the business sector screen. It also passes debt compliance and cash compliance.
| Business Activity | Debt Compliance | Cash Compliance |
|---|---|---|
| Pass | Pass | Pass |
Alinma Bank is classified Shariah-compliant.
Compliance Status Is Dynamic, Not Permanent
A company classified compliant today can fail next period if it takes on interest-bearing debt, parks cash in conventional deposits, or changes its revenue mix. Islamicly monitors available information daily, while financial screening is reassessed when updated financial information becomes available. Use the Islamicly app to be alerted the moment a holding changes status.
Sector-Wise Shariah Screening in Saudi Arabia
Capital Goods, Consumer/Non-Cyclical and Transportation clear every listed company. Financial is the lowest of the large sectors, at 65%.
| Sector | Compliant | Shariah non-compliant | Total | % Compliant |
|---|---|---|---|---|
| Services | 113 | 5 | 118 | 96% |
| Capital Goods | 57 | 0 | 57 | 100% |
| Financial | 35 | 19 | 54 | 65% |
| Consumer/Non-Cyclical | 44 | 0 | 44 | 100% |
| Basic Materials | 41 | 1 | 42 | 98% |
| Healthcare | 30 | 1 | 31 | 97% |
| Technology | 16 | 1 | 17 | 94% |
| Consumer Cyclical | 10 | 1 | 11 | 91% |
| Transportation | 10 | 0 | 10 | 100% |
| Energy | 8 | 1 | 9 | 89% |
| Investment Services | 9 | 0 | 9 | 100% |
| Utilities | 4 | 1 | 5 | 80% |
| Misc. Financial Services | 2 | 0 | 2 | 100% |
| Business Services | 1 | 0 | 1 | 100% |
| Healthcare Facilities | 1 | 0 | 1 | 100% |
| Grand Total | 381 | 30 | 411 | 92.7% |
About Islamicly
Islamicly is a Shariah-certified app and web platform for screening Shariah-compliant equities. It provides Shariah compliance information for stocks listed on the Saudi Exchange (Tadawul), and for companies listed across global markets.
Screening is carried out against AAOIFI-based standards and reviewed by Islamicly's Shariah Supervisory Board, chaired by Dr. Mohamed A. Elgari (Saudi Arabia), with Dr. Muhammad Amin Qattan (Kuwait) and Dr. Nazih Hammad (Canada). Every classification published by Islamicly, including those in this report, is produced under that framework.
On the app and web platform, investors can check the Shariah status of any listed stock, screen an existing portfolio for non-compliant positions, view a stock's historical compliance data, calculate dividend purification amounts, and receive alerts when a holding changes status. Islamicly also offers Shariah-screened model portfolios, digital gold and silver, mutual funds and managed-investment options, and runs free AMAs and webinars on halal investing.
Check the current Shariah status of any Saudi stock on the Islamicly app or web platform — screen individual stocks, screen an existing portfolio, calculate purification amounts, and get alerted when a holding changes status.
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