On DFM, foreign investors generate 49% of trades - will Talabat IPO pull in more?
As Talabat prepares its IPO, more foreign and younger investors will head DFM's way
Dubai: Non-UAE investors are making their presence felt on the DFM, with 49% of the Dubai exchange’s trading volumes in the first 9 months of 2024 generated by them.
Not just that, of the 91,151 new investors who signed up to buy/sell stocks on DFM in these nine months, 85% were based outside of the UAE. Net purchases by foreign investors totaled Dh1.5 billion. “The growing participation of foreign investors, alongside significant contributions from institutional investors, reiterates DFM’s role as a leading financial hub,” said a statement from the exchange. (Institutional investors made up 65% of the traded value during the period.)
That and new IPOs during the year to end September helped DFM record profit before tax of Dh298.7 million, a sharp 60% increase. Overall revenues were higher by 29% to Dh460.3 million.
More overseas - and a younger demographic of - investors should make their way onto DFM trading accounts as the clock ticks towards the next likely IPO, that from the food delivery aggregator platform Talabat. The timeline of the exact IPO schedule has not been confirmed, apart from Talabat recently announcing that it would do so in Q4-2024.
Talabat has a sizeable share of the local food delivery and related services market, and has generally been seen as a genuine GCC success story. Market analysts talk about its IPO likely to draw a significant intake of Gen Z investors.
All of which helps DFM
“The consistent growth of new investors and the strong performance of the DFM General Index demonstrates the confidence that both local and international investors have in the Dubai’s thriving financial ecosystem,” said Helal Saeeed Al Marri, Chairman of DFM.
LuLu Retail closes next week
Meanwhile, the LuLu Retail IPO is heading for a bumper closing of subscription on November 5, with the ADX listing scheduled for November 14. All eyes obviously will be on whether the UAE hypermarket operator will allow a higher percentage for retail investors from the current 10%.
"Between LuLu and a future Talabat float, UAE stock markets would see a significant increase in new investors," said an analyst. "And can create one of the most decisive Q4s for UAE stocks in the recent past."
Late last year, the IPOs from Parkin in Dubai and Abu Dhabi's PureHealth had a rousing reception from investors. This time, LuLu and Talabat could provide an encore.