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Trading is due to start today on Emaar Development, a unit of Dubai property firm Emaar Properties, the emirate’s first major IPO in three years.
The assets of Emaar Development include 49 units in Dubai's Burj Khalifa, the world's tallest skyscraper and a number of projects in Dubai's prime districts. The IPO has been priced at 6.03 UAE dirhams, valuing the deal at $1.31 billion, according to Reuters.
In the run-up to today’s listing, Emaar Properties’ share price has been in decline and was down a further 1.7 percent on Tuesday. “It has been sliding since late last week, when it priced the initial public offer of its local real estate development unit in the lower half of an indicative range,” Reuters reported.
However, some analysts were positive ahead of the landmark IPO. “We are hopeful Emaar Development would open to a positive response from investors. The guaranteed dividend yield for three years, of more than 8 percent will see many yield chasing buyers,” Vrajesh Bhandari, portfolio manager at Al Mal Capital, was quoted as saying by Gulf News.
For Emaar as a whole, the last few weeks has seen some positive news, with Emaar Properties reporting a 32 percent rise in third-quarter net profit, helped by a surge in sales of residential properties.
At the same time, Emaar Malls, the conglomerate’s shopping malls and retail business which was listed in 2014, recorded a net profit of $410 million during the first nine months of 2017, a year-on-year increase of 6 percent.
Today’s listing comes as IPO activity across the Gulf has begun to gain momentum in 2017, the Khaleej Times reported earlier this month. This year there has been 17 IPOs, compared to just four in 2016. However, despite the increased number of offerings, the proceeds raised (ahead of the Emaar Developments IPO) was 4 percent lower than last year, the report added.
Further reading:
© ZAWYA 2017
The assets of Emaar Development include 49 units in Dubai's Burj Khalifa, the world's tallest skyscraper and a number of projects in Dubai's prime districts. The IPO has been priced at 6.03 UAE dirhams, valuing the deal at $1.31 billion, according to Reuters.
In the run-up to today’s listing, Emaar Properties’ share price has been in decline and was down a further 1.7 percent on Tuesday. “It has been sliding since late last week, when it priced the initial public offer of its local real estate development unit in the lower half of an indicative range,” Reuters reported.
However, some analysts were positive ahead of the landmark IPO. “We are hopeful Emaar Development would open to a positive response from investors. The guaranteed dividend yield for three years, of more than 8 percent will see many yield chasing buyers,” Vrajesh Bhandari, portfolio manager at Al Mal Capital, was quoted as saying by Gulf News.
For Emaar as a whole, the last few weeks has seen some positive news, with Emaar Properties reporting a 32 percent rise in third-quarter net profit, helped by a surge in sales of residential properties.
At the same time, Emaar Malls, the conglomerate’s shopping malls and retail business which was listed in 2014, recorded a net profit of $410 million during the first nine months of 2017, a year-on-year increase of 6 percent.
Today’s listing comes as IPO activity across the Gulf has begun to gain momentum in 2017, the Khaleej Times reported earlier this month. This year there has been 17 IPOs, compared to just four in 2016. However, despite the increased number of offerings, the proceeds raised (ahead of the Emaar Developments IPO) was 4 percent lower than last year, the report added.
Further reading:
- Nasdaq Dubai to create futures on Emaar Development stocks
- Emaar Properties to raise $1.3bln in development unit's IPO
- Dubai's Emaar Properties Q3 profit up 32% as home sales surge
- Why GCC IPO market has picked up
- MIDEAST STOCKS: Emaar still sliding in Dubai
© ZAWYA 2017
