Abu Dhabi-based supermarket giant Lulu Retail Holdings on Monday announced its decision to proceed with an Initial Public Offering (IPO) of 25 per cent of its stock in a bid to list its shares in the Abu Dhabi Securities Exchange (ADX). A total of 258 crore shares will be on offer, with a nominal value of US 0.014 each.
UAE retail investors (including eligible employees of the group), professional investors, and eligible senior executives can subscribe to the IPO. The subscription period will open on October 28 and end on November 5, with the final offer price to be determined through a book-building process.
The company sees a semi-annual dividend payout ratio of 75 per cent of annual distributable profits after tax, and estimates the dividend for the six months ended 31 December 2024 to be paid in the first half of 2025. In the GCC alone, Lulu has more than 240 stores across six countries.
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"Integral to our growth is the vision and ambition of the UAE, KSA and the other GCC nations where strong national leadership is enabling positive demographic and consumption trends and driving impressive economic growth," said Lulu founder and chairman Yusuffali M.A.
"We’re looking forward to welcoming new shareholders to Lulu and are sure they will share our passion for the company and excitement for the future,” added Yusuffali.
The IPO will be done in three tranches. The first tranche is the public offering to UAE Retail Investors, including eligible employees. The second tranche is open to professional investors, and the third to eligible senior executives under the “Senior Executives Offering”.
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Lulu sees GCC retail market to continue steady growth
"With GCC retail presenting a USD 100 billion market opportunity over the next five years and our business in the Kingdom of Saudi Arabia primed for further growth, we are confident that Lulu will continue to be where the world comes to shop," estimated Lulu CEO Saifee Rupawala.
The group sees positive retail growth in the near-term future for the region, based on growing youth populations, rising spending power, and climbing employment rate. It projects a growth of 4.2 per cent CAGR for the GCC grocery retail market and 4.8 per cent CAGR for the GCC modern from 2023 to 2028.
Lulu boasted a 61 per cent rise in net income of USD 11.6 crore from continuing operations for the first half of FY 2024, up 61 per cent from USD 7.2 crore from the same period a year ago. Revenue grew 5.5 per cent to USD 386.8 million (around Rs 3,252 crore).
