Monday, October 21, 2024
UAE: Lulu IPO set to maintain trend of heavy oversubscription, say analysts
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Vijay Valecha, Khaleej Times, October 21, 2024
The upcoming share sale by the retail giant Lulu Group next week is expected to be another blockbuster IPO, maintaining the trend of strong oversubscription that previous public offerings saw in the post-pandemic period.
The previous IPOs that were floated on the Dubai and Abu Dhabi bourses saw tremendous response from retail and institutional investors, prompting some of them to increase the amount of funds that they were looking to raise through the share sale.
To name a few, utility services provider Dewa was oversubscribed 37 times, Salik 49 times, Parkin 165 times, Borouge 45 times and others.
Lulu Retail Holdings’ IPO will run from October 28 to November 5, offloading a 25 per cent stake through three tranches. This could be the UAE’s largest IPO this year due to the robust growth of the retail sector, and a strong dividend policy among other factors. It is expected that the final offer price will also be competitively priced, which will attract a wider investor base.
Joseph Dahrieh, managing principal at Tickmill, said the Lulu IPO, which is set to raise approximately $2 billion, could see significant interest and be oversubscribed.
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