Lulu Retail Holdings, a major hypermarket chain in the Middle East, has launched its initial public offering (IPO), with expectations of it being the largest in the UAE this year. The conglomerate, operating over 240 stores across the GCC countries, is capitalizing on a retail spending boom in the region. The IPO, set to run from October 28 to November 5, aims to raise between $1.7 billion and $1.8 billion for a 25% stake. Lulu follows the trend of grocery firms going public, with UAE-based Spinneys and Saudi retailer BinDawood Holding also recently listing. The company reported strong revenue growth, driven by sales from existing stores, store network expansion, and an increase in online sales. Core earnings have also been on the rise.
Lulu Group, founded by Indian businessman Yusuff Ali in 1974, is the largest full-line retailer in the GCC by selling space, sales volume, and store count. It is the second-largest grocery retailer in the UAE and the largest in Oman, Qatar, Bahrain, and Kuwait, with a strong presence in Saudi Arabia. With 240 stores including hypermarkets, express stores, and mini-markets, Lulu serves over 600,000 daily shoppers, sourcing products from 85 countries. The company’s total selling space of 1.3 million square meters is three times larger than its listed peers in the GCC, supported by 21 distribution centers across the region.
Yusuff Ali, founder and chairman of Lulu Retail, credits the company’s success to the vision and ambition of GCC nations and their strong leadership. He welcomes new shareholders, emphasizing Lulu’s commitment to retail excellence in the region. The company has outlined a commitment to maintain a total dividend payout ratio of 75% of annual distributable profits after tax, with payouts scheduled twice a year. Lulu reported revenues of $7.27 billion in 2023, up from $6.89 billion the previous year, showcasing consistent growth and potential for further expansion.
The IPO has garnered significant interest from investors, with expectations of it being the largest in the UAE this year. Lulu’s track record of revenue growth, strong market presence, and commitment to dividend payouts have positioned it as an attractive investment opportunity. The company’s focus on maintaining retail excellence and capitalizing on the growing retail sector in the region bodes well for future growth and success. The IPO, expected to raise between $1.7 billion and $1.8 billion, is set to begin trading on the Abu Dhabi Securities Exchange on November 14, offering investors a chance to be part of Lulu’s continued success.
As Lulu Retail Holdings prepares to go public, the company’s leadership remains optimistic about its future prospects. The IPO document outlines the company’s financial performance, revenue growth, and commitment to delivering value to shareholders. With a strong market position, expansive store network, and growing online sales, Lulu is well-positioned to capitalize on the retail spending boom in the GCC. Investors and stakeholders alike are eagerly awaiting the trading debut of Lulu Retail Holdings on the Abu Dhabi Securities Exchange, expecting it to be a significant milestone in the company’s journey towards sustained growth and success in the region.
In conclusion, the IPO of Lulu Retail Holdings marks a significant milestone for the company as it seeks to capitalize on the retail spending boom in the GCC. With a strong market presence, consistent revenue growth, and commitment to dividend payouts, Lulu presents an attractive investment opportunity for those looking to participate in the region’s retail sector. The company’s expansion plans, focus on retail excellence, and track record of success position it as a key player in the Middle East’s retail landscape. As Lulu Retail Holdings prepares to debut on the Abu Dhabi Securities Exchange, all eyes are on the company’s performance and potential for future growth in the dynamic and fast-growing GCC market.
