Spinneys, the operator of high-end supermarkets across the UAE and Oman, celebrated a successful debut on the Dubai Financial Market (DFM) on May 9th, 2024. The company's share price witnessed a surge of over 9% in early trading, reflecting strong investor confidence.
The initial public offering (IPO) concluded with a flourish, garnering Dh1. 37 billion (US$375. 7 million) after exceeding investor demand by a staggering 64 times. This level of oversubscription marks a record for non-government related offerings on the DFM in recent years. The final share price was set at Dh1. 53, the highest within the proposed range.
Spinneys' impressive IPO performance translates to a market capitalization exceeding Dh6 billion (US$1. 63 billion) upon the Dubai market's opening bell. The company's stock initially rose to Dh1. 67, a significant 9. 15% increase over the issued price. While gains moderated later in the trading day, settling at around Dh1. 62, the overall sentiment remained positive.
This strong market debut for Spinneys comes on the heels of another successful IPO earlier this year – parking operator Parkin. Parkin's offering, the first in the UAE's capital markets for 2024, raised Dh1. 57 billion with investor demand reaching a record Dh259 billion.
Spinneys' success can be attributed to several factors. The company boasts a dominant position in Dubai's premium grocery market, capturing a 27% share in 2022. Additionally, it holds a significant 12% share of the Dh23 billion UAE market, demonstrating its established presence across the region. Spinneys' focus on fresh food offerings, private label brands, and a growing online sales segment further contribute to its investor appeal.
The company's expansion plans also likely factored into investor enthusiasm. Spinneys intends to leverage the capital raised through the IPO to fuel its growth strategy, with a specific focus on entering the Saudi Arabian market in 2024.
Spinneys' listing on the DFM is a significant development for the Dubai market, attracting both regional and international investors. The company's strong debut underscores investor confidence in the UAE's retail sector and paves the way for further growth within the industry.