Dubai’s IPO gambit adds $2.3 billion to bourse operator’s value

While Abu Dhabi and Riyadh drew in orders worth billions of dollars from marquee listings, Dubai was left behind. The new head of the city’s financial market has announced a series of steps this month to help reverse that.

A flurry of announcements since the start of the month have helped push Dubai Financial Market’s market value to about 17 billion dirhams ($4.6 billion). Including Sunday’s 10% rise, the shares have rallied 107% since Nov. 1 after languishing for most of this year.

“Sometimes all investors want is to see serious steps on the right track,” Dubai’s former finance chief, Nasser Al-Shaikh, said in a tweet. “This is what Dubai has given them through a series of decisions.”

Once the United Arab Emirates’ leading exchange by traded volume, the city’s bourse is now second to Abu Dhabi. Dubai has seen one listing since 2017, and a string of delistings that have dented investor confidence. Equity trading in Dubai has fallen in three of the past four years. 

Sheikh Maktoum Bin Mohammed’s plans to grab a slice of the IPO action include listing as many as 10 state-owned firms, including utility DEWA — likely to be the city’s biggest deal — and its Salik road toll collection system. Private and family-owned businesses are also being encouraged to sell shares on the local bourse.

Salik is a “cash machine,” Mohammed Ali Yasin, the chief strategy officer at Al Dhabi Capital Ltd., said in a Bloomberg TV interview. “2022 could be a very successful year for the DFM.”