DUBAI: The initial public offering (IPO) of Talabat, the Middle Eastern food delivery service, under the auspices of Delivery Hero SE, has showcased substantial demand, evidencing the resilience and attractiveness of regional equity markets.
The offering, valued at approximately $1.5 billion, witnessed an immediate subscription demand that covered the entire share range as soon as books opened, indicating strong market confidence in Talabat and the broader economic landscape of the Gulf region.
The share price was set between AED1.50 ($0.41) and AED1.60, allowing a strategic valuation of Talabat at around $10.2 billion.
The figure, while below Delivery Hero’s $11 billion market capitalisation, underscores the ongoing adjustments within the valuation expectations of emerging tech companies in the Middle East. Notably, analysts from Emirates NBD had projected an even higher market valuation for Talabat, suggesting a potential worth up to $14.4 billion.
The anticipation surrounding the IPO, as articulated by financial experts, reflects the dual objectives of Delivery Hero: to enhance its cash liquidity for deleveraging purposes and to prompt a reassessment of its comprehensive valuation metrics.
Market enthusiasm is further augmented by Talabat’s competitive positioning, which may lead to more favorable perceptions and re-evaluations of Delivery Hero’s market value in the future.
Despite recent setbacks for other Gulf IPOs, including those from Lulu Retail and an Omani state-owned entity, Talabat’s offering appears to mark a pivotal point. The latter’s failed launches serve to highlight the variable dynamics of market performance; nonetheless, the initial reception of Talabat has diverged from previous disappointments, suggesting an evolving investor appetite.
With the final pricing of Talabat’s shares set to be announced on November 29 and trading commencing on December 10, all eyes will be on the performance of this IPO.
Should it continue to attract positive investor sentiment, Talabat may well redefine market expectations and invigorate the IPO landscape within the region. As such, this offering not only represents a momentous financial maneuver for Delivery Hero and Talabat but also serves as a bellwether for future capital markets in the Middle East.
