UAE: Lulu Retail IPO opens today, allowing residents to diversify investments

Subscription of Lulu Retail’s initial public offering (IPO) opens today (Monday) in the UAE with a minimum subscription of Dh5,000 for retail investors.

Running from October 28 to November 5, Lulu Group will offload a 25 per cent stake by selling over 2.582 billion (2,582,226,338) shareson the Abu Dhabi Securities Exchange. The listing is expected on November 14, 2024.

As reported by Khaleej Times earlier, is expected to see an overwhelming response from both retail and institutional investors in the coming week. Analysts see IPO likely to be

Some smaller UAE investors have been to subscribe to the IPO.

Lulu Group is one of the largest retailers in the UAE and GCC region, employing over 50,000 workers. Investors have been waiting for the retail giant’s IPO to

George Pavel, general manager at Capex.com Middle East, said the retail major’s IPO will allow investors to diversify investment opportunities in the UAE's capital markets.

“The entry of a major retail player like Lulu could attract more foreign investment and enhance market depth. Moreover, the IPO might help drive other businesses in the region to go public, increasing transparency and corporate governance standards,” he said.

Under the first tranche for individual subscribers and eligible employees, 258.222 million shares will be up for subscription, representing 10 per cent of the offer share. Each subscriber – other than eligible employees – will have a minimum guaranteed allocation of 1,000 shares and each eligible employee will have a minimum guaranteed allocation of 2,000 shares.

The minimum application size for first tranche subscribers is Dh5,000 with any additional application to be made in increments of Dh1,000. There is no maximum application size for this tranche.

Individual investors can subscribe through Abu Dhabi Commercial Bank, First Abu Dhabi, Dubai Islamic Bank, Emirates Islamic Bank, Mashreq and Emirates NBD.

Under the second tranche for institutional investors, Lulu Retail aims to offload 2,298,181,441 shares, representing 89 per cent of the off share.

The minimum application size for the second tranche subscribers is Dh5 million. There is no maximum application size in this tranche.

Over 25.822 million shares will be sold through the third tranche for senior executives, representing one per cent of the offer share. The minimum application size for third tranche subscribers is Dh50,000 with any additional application to be made in increments of Dh1,000. There is no maximum application size for subscribers in this tranche also.

Lulu Retailer IPO can be , subject to the laws of those countries.

Retail investors can approach a stock broker in the UAE and retailer’s receiving banks for subscriptions. There are almost 20 banks in the syndicate where people can subscribe. The basic requirement for subscribing IPOs in UAE is to have a National Investor Number (NIN), which can be obtained through brokerages.

Investors outside the UAE can obtain information and guidelines from the websites of the brokerages in the UAE and approach them to know about the documents and procedures on how to get NIN and subscribe. Brokerages will perform their KYC (know your customer) before applying for the NIN and subscription.

In addition, there is also a detailed FAQ available online for interested investors.