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Marka jumps 59% in trading debut

Shares of Marka, the first public joint stock company focused on the retail sector, jumped 59 per cent on Thursday on its first day of trading, underscoring strong investor appetite.

Marka shares closed at Dh1.59 on the Dubai Financial Market, up from their initial public offer price of Dh1, and hitting a high of Dh2 and a low of Dh1.53.

Marka’s Dh275 million IPO, which was more than 36 times oversubscribed, was the DFM’s first since 2009. The company is also the DFM’s first company to focus on the region’s retail and hospitality sector.

Announcing the entry of Marka, the DFM said the successful listing of Marka further fortified the prominent position of the bourse as the most favoured listing venue for leading local and regional companies and lifts the total number of listed companies to 55.

Essa Kazim, chairman of the DFM; Jamal Al Hai chairman of Marka; and senior representatives from both sides attended the listing ceremony at DFM’s trading floor. The listing enables investors to benefit from the growth of a key sector representing approximately 30 per cent of Dubai’s GDP, said Kazim.

Marka became the first IPO issuer to list on DFM since 2009 as well as the first issuer to utilise the DFM “eIPO” platform, a sophisticated and efficient solution for IPO subscription directly linked with the receiving banks.

“The listing of Marka on the DFM heralds a new era of thriving IPO activity and represents an initial success for DFM’s constant efforts to encourage private and family businesses to go public and list on the exchange. This listing is an invaluable addition to the market as it enables investors to benefit from the growth of the trade sector, which is one of the key sectors that drives Dubai’s economy,” said Kazim. “Having companies representing the trade sector on board will further boost DFM’s efforts to achieve one of its strategic objectives, which is to fully reflect the most important sectors of the economy by attracting companies from major and fast growing sectors including retail, tourism, heath and education.”

“We also provide support for these companies to achieve their growth strategy by benefiting from the capital markets. Since the DFM was established, it has been efficiently playing this role for companies representing various sectors including real estate, banking, transportation and telecommunication,” he said.

Kazim pointed out that over the past years, the DFM has been tirelessly promoting awareness of the benefits of going public through organising forums and seminars as well as publishing practical guides addressing the requirements and key steps to implement this strategic decision, as the next milestone in the journey of private and family businesses. “We have actively communicated with hundreds of companies through one-on-one meetings to further support managements’ efforts to prepare their companies for the post-IPO requirements including transparency and disclosure commitments; having an effective investor relations function; and having a proper corporate governance structure.”

Kazim said the outlook for IPO activity overall is positive in view of the substantial list of companies that are ready to take this route. “Perhaps the first indication that supports this belief is the successful issuance and listing of Marka shares and the preparations for the IPO of Emaar Malls in the coming,” he said.

Al Hai said Marka is committed to generating “long-term value for our shareholders, our partners and our community and are glad to offer our investors the opportunity to benefit from one of the fastest-growing sectors in the UAE.”

— issacjohn@khaleejtimes.com