Dubai: Dubai benchmark index jumped more than 2 per cent on Thursday led by Emaar Properties, whose unit’s initial public offering was underway since Sunday.
The Abu Dhabi index also rose with National Takaful Company.
The Dubai Financial Market (DFM) General Index ended 2.27 per cent higher at 5,097.82. Emaar Properties, which was the most active stock by value, rose 4.98 per cent to end at Dh11.60. Arabtec, the second-most active stock, ended 4.80 per cent higher at Dh1.05.
“We are in the book building process of Emaar Mall IPO. There has been a very good response for the IPO, If someone is not able to get allocation to the IPO, the next best way is to buy shares of the parent company,” Saleem Khokhar, head of equities at NBAD’s asset management group told Gulf News. After the IPO, Emaar Properties will still own 85 per cent of Emaar Mall Group (EMG).
Emaar Properties has sought to raise up to Dh5.8 billion by selling 2 billion shares in the price range of Dh2.5-Dh2.9 per share in its mall unit.
Emaar said earlier in the week that the qualified institutional investors portion was fully subscribed, pointing out to robust appetite for the offering. The EMG will be listed on the DFM on Oct. 2.
At least 70 per cent of the Emaar Malls offering will be allocated to qualified institutional investors and 30 per cent to individuals. A minimum 10 per cent will be earmarked for Emaar shareholders as of Sept. 10, while the Emirates Investment Authority reserved 5 per cent of the offering allocated to institutions.
“It [Dubai market] is expected to remain positive next week, but we do expect volatility,” said Khokhar. The DFM index gained 2.75 per cent in the week to September 18.
Strong fundamentals in Abu Dhabi
“Fundamentals are good, valuations are also good in Abu Dhabi. The underlying strength of the UAE economy is very strong,” said Khokhar, adding index may jump by a fifth in a period of 18 months.
In Abu Dhabi, the general index ended 1.19 per cent higher at 5,223.18. The index has already gained 43.68 per cent in the past one year.
Out of a total of 35 companies, shares of 19 companies rose, while 7 of them declined and the other 9 remained steady. Insurance firm National Takaful Company rose more than 9 per cent in trade, while Abu Dhabi National Hotels rose more than 6.5 per cent.
