 "Lulu shares fall on trading debut in Abu Dhabi stock market after mega Gulf IPO: 12 things to know")
UAE-based Lulu Retail Holdings Plc debuted on the Abu Dhabi Security Exchange, or ADX, on Thursday after a record-breaking initial public offering (IPO) that caught global attention, but its shares fell on the first trading day.
Lulu encounters rarity
In a rarity in West Asia, where listings of stocks in early trading mostly offer exceptional returns, Lulu Retail Holdings shares fell after its $1.72 billion initial public offering.
On the day of its debut trade, Lulu Retail Holdings fell to as much as 1.99 dirhams per share, down 2.5 per cent from the offer price of 2.04 dirhams.
Trading under the ticker symbol “LULU” the shares of the hypermarket chain operator, according to a report in The Nation, was the most traded stock on ADX, with as much as 203.92 million shares exchanged as of 1:40 pm UAE time.
Lulu makes stock market debut after Gulf’s mega IPO
1 - Founded in 1974 by Kerala-based business tycoon MA Yusuff Ali, Lulu Retail Holdings which operates more than 240 stores across six GCC (Gulf Cooperation Council) countries, opened subscription of its IPO on October 28.
2 - In one hour of opening, the Lulu IPO received exceptional investor interest and was oversubscribed.
3 - On November 6, Lulu announced that its IPO was oversubscribed 25 times across all tranches.
4 - Lulu offered the final offer price at AED 2.04 per share, raising a total of $1.72 billion (AED 6.32 billion), and making it the largest IPO in the UAE in 2024 to date.
5 - Lulu IPO saw an aggregate demand of over AED 135 billion from local, regional, and international investors.
6 - It drew $37bn-worth of orders for its IPO from global investors.
7 - A record 82,000 retail investors subscribed for shares in Lulu IPO.
8 - More than 50,000 individuals registered in 16 days between Lulu announcing its Intention to Float and the close of subscriptions.
Impact Shorts
More Shorts9 - To address the high demand from foreign and regional investors, Lulu increased the IPO size from 25 per cent to 30 per cent to accommodate a broader range of participants.
10 - It was a record for a non-government UAE IPO over the past decade.
11 - Lulu share sale overtook oil services firm NMDC Energy’s $877 million offering as the UAE’s biggest IPO of the year.
12 - Many first-time investors participated in Lulu’s IPO with key investors being Abu Dhabi Pension Fund, Emirates International Investment Company, Bahrain Mumtalakat Holding Company, Oman Investment Authority, Kuwait Investment Authority, Qatar Investment Authority, Saudi Public Investment Fund, Hassana Pension Fund, and the Singapore Sovereign Wealth Fund, among others.
Lulu’s founder, India-born Yusuff Ali’s net worth increased to $7.1 billion after share sale and this helped him cement his position as the UAE’s second-richest private individual.
After arriving in the UAE in 1973, Ali opened his first grocery store the next year and gradually Lulu turned into one of West Asia’s largest hypermarket chains. It serves over half a million shoppers and employs more than 50,000 people. Last year Lulu reported a profit of $192 million.
With inputs from agencies
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