In a landmark move, UAE retail powerhouse LuLu Group International announced on October 21 that it will offer 25% of its shares in an initial public offering (IPO), set to be listed on the Abu Dhabi Securities Exchange (ADX).
The hypermarket chain operator aims to sell a total of 2,582,226,338 shares, each with a nominal value of Dirham 0.051. The IPO will be conducted in three tranches, with subscription starting on October 28 and closing on November 5, 2024. The offering is open to UAE retail investors, employees, institutional investors, and eligible senior executives.
Book Building Process and Dividend Strategy
The final offer price will be determined through a book building process, with trading expected to commence on the ADX around November 14. LuLu Group anticipates a total dividend payout ratio of 75% of annual distributable profits after tax, distributed semi-annually. The company plans to issue dividends for the six months ending December 31, 2024, in the first half of 2025.
Leadership Remarks and Company Growth
M A Yusuffali, founder and Chairman of LuLu Group, expressed pride in the IPO announcement, highlighting the company’s position as the largest full-line retailer across the GCC. Since its founding in 1972, LuLu Group has expanded to over 240 stores in six GCC countries, exceeding its own growth expectations.
“We’re eager to welcome new shareholders to LuLu and share our passion for the company and our excitement for future endeavors,” Yusuffali stated.
Saifee Rupawala, CEO of LuLu Retail, emphasized the brand’s strong presence in the GCC retail market, noting, “Our scale is matched by a proven track record of substantial revenue growth, attractive profit margins, and a focused growth strategy.” He added that LuLu Group is committed to enhancing value from existing stores, expanding its network, improving operational efficiencies, and growing its high-value private label and loyalty programs.
With the GCC retail sector poised to present a $100 billion market opportunity over the next five years, Rupawala expressed confidence in LuLu’s potential, particularly in the Saudi Arabian market, stating, “We are certain that LuLu will continue to be the go-to destination for shoppers worldwide.”
