Lulu Group IPO in Abu Dhabi next week; 25% stake on offer

Lulu Group International, one of the largest hypermarket chains in the Middle East, is set to sell a 25% stake in an initial public offering (IPO) in Abu Dhabi. The company plans to offer 2.582 billion shares, with the subscription period starting on October 28 and ending on November 5.

All shares will be sold by Lulu International Holdings, the company’s sole shareholder. Retail investors in the UAE, including employees of the group, as well as institutional investors and eligible senior executives, will have the opportunity to subscribe. The final share price will be determined through a book-building process, with trading expected to begin on the Abu Dhabi Stock Exchange around November 14.

From one store to largest in Gulf

Saifee Rupawala, CEO of Lulu Retail, expressed pride in the company’s growth, stating, “We’ve grown from one store in Abu Dhabi to the largest retailer in the GCC by market share and the fastest-growing player in Saudi Arabia.” He highlighted the GCC retail market as a significant opportunity, estimating it to be worth $100 billion over the next five years.

Founded in 1974 by Indian businessman Yusuff Ali, Lulu operates over 240 hypermarkets and shopping malls across ten countries, including India, Egypt, Malaysia, and Indonesia. The company aims to pay dividends amounting to 75% of its annual distributable profits after tax, with plans to start dividend payments in early 2025.

The growth metrics

Lulu Group has seen steady revenue growth, reporting a 5.6% increase to $3.9 billion in the first half of this year. The growth is attributed to rising sales from existing stores, expansion of its store network, and an increase in online sales. The company plans to open 80 new hypermarkets across the Gulf region and other countries within the next two years.