Is UAE retail giant Lulu's share price making a comeback?

Dubai: Is Lulu’s stock price in the mood for a comeback?

After dropping 32% this year to Dh1.1, the ADX-listed share of the retail giant is slowly regaining some of the shine.

The Lulu Retail stock is now up 16% to Dh1.28. Market watchers reckon that next week’s trades will be crucial as the company readies to announce its Q1-2025 results.

So far today, Lulu is at Dh1.26, lower by over 1%. But investors reckon there is a real possibility for Lulu's share to bounce back - and most important, hold its ground.

The Lulu IPO price was Dh2.04 and resulted in one of the biggest retail subscriptions ever for a UAE enterprise.

“Despite the uncertainty surrounding US tariffs and a slowdown for GCC economies, Lulu Retail’s margins and profitability are expected to rise for Q1-25 and going forward,” said Sameer Lakhani, Managing Director at Global Capital Partners.

“(The Lulu share price gain) suggests that investors are turning optimistic about the company’s performance.

“Of course for value investors, this is an opportunity to accumulate holdings. And this has increasingly been reflected at both the retail and institutional investor level.”

One of the big takeaways from the Lulu IPO was the presence of retail investors, many of whom had been first-time subscribers to a UAE stock market float.

The Dh2.04 was the higher of the price range, and Lulu eventually drew an aggregate demand of Dh135 billion from subscribers. This made it the biggest for non-UAE government entity in 10 years.

But once it listed, the stock was pulled lower, and the process accelerated after the company announced its 2024 numbers (even though the financials showed rock-solid growth in regional markets).

This is why the Q-2025 results announcement will be crucial in setting the Lulu stock's short-term trajectory.

“We remain focused on strengthening our market position and look forward to the journey ahead with purpose and a shared vision for sustained growth," is what Saifee Rupawala, CEO of Lulu Retail said last week after the company's first AGM since the IPO.

Lulu continues to deepen its Gulf-wide network. In Oman, there was the tie up between Tamani Global and LuLu International Holdings to 'support' the operational development and asset performance of Mall of Muscat.

The Oman mall covers 1 million plus square feet of leasable area and hosts more than 170 retail outlets—including the 'Oman Aquarium', the first of its kind in the Sultanate.

And this week, in the UAE, it was confirmed that the Ministry of Financeis integrating Lulu's B2B e-commerce platform - LuLuOn - into the UAE federal government’s digital procurement system.

What this means is that UAE government agencies can now access LuLu’s product catalogue directly within the government’s e-procurement platform.

"Lulu Retail remains operationally strong, and there are still new areas of growth coming through," said a market analyst. "Somehow, so far, Lulu Retail's share price has not been able to catch up.

"There had been talk that Lulu would look to a share buyback plan like other ADX companies such IHC and Burjeel Holdings have done. But if the stock regains its footing organically, nothing like it..."