Latest news with #UCIC
Zawya
a day ago
- Business
- Zawya
GCC equity markets ease into Eid break after Dubai Residential REIT, Saudi UCIC IPOs
GCC markets will enter the summer period buoyed by the debut of the Dubai Residential REIT on the Dubai Financial Market (DFM) last week, a $584 million IPO that closed at 14% on its day one trade. Meanwhile, Saudi Arabia's upcoming Flynas and Specialized Medical Company (SMC) IPOs are expected to inject fresh energy into a market weighed down by the listing of United Carton Industries Co. (UCIC), which closed 1.5% lower last week than on its debut trade. While UCIC lost ground due to a mix of profit booking, overstretched valuations and tariff threats, Dubai Residential REIT's strong market debut reflects a positive investors' appetite for the emirate's real estate and the sector's strength, analysts said. The Dubai Residential REIT offering was upsized by the fund manager from 12.5% to 15% after it attracted strong demand across both institutional and UAE retail tranches. 'The offering, which was oversubscribed 26 times with AED 56 billion in gross demand, benefited from Dubai's resurgent real estate market and the REIT's extensive portfolio of 35,700 residential units. A projected 2025 dividend yield of 7.7% further supported the investment case,' said George Pavel, General Manager at Middle East. 'In contrast, UCIC's more subdued reception reflects investor unease around its valuation and the broader Saudi stock market's correction. While the Saudi packaging firm managed to raise SAR 600 million with a nine times oversubscription, it listed at a price-to-earnings ratio well above its regional peers. This, combined with broader market volatility, contributed to a choppy debut.' Pavel said that without a 'compelling growth narrative or sectoral tailwinds comparable to real estate,' UCIC struggled to sustain momentum, 'illustrating the divergent fortunes that can emerge even in an upbeat IPO pipeline.' Investor sentiment 'The forthcoming listings of Flynas and SMC are set to inject fresh momentum into the GCC's IPO pipeline in the coming weeks,' Pavel said. 'Flynas's remarkable oversubscription, reportedly around 100 times, points to a strong appetite among institutional investors and reinforces confidence in the region's equity markets. This enthusiasm is likely to encourage other companies across the GCC to advance their listing plans, particularly in sectors aligned with economic diversification such as healthcare, consumer goods, and aviation.' The Saudi budget airline's retail IPO, which closed on June 1 after its institutional offering drew $109 billion, is being called a value proposition by insiders expecting a robust run for the first Gulf airline listing in nearly two decades, backed by Saudi billionaire Prince Alwaleed bin Talal's Kingdom Holding and the kingdom's National Flight Services Co. SMC, meanwhile, has extended its book-building period to allow qualified investors to review their bids and postponed the retail offering period to June 15. According to Pavel, the success of two high-profile Saudi listings will 'send a clear signal that well-positioned firms with compelling growth narratives can attract capital despite ongoing global market uncertainties.' 'This should help sustain IPO activity across the Gulf, supporting a healthy pipeline through mid-2025 and potentially broadening investor participation beyond traditional domestic markets,' he added. Vijay Valecha, Chief Investment Officer at Century Financial, warned of broader headwinds playing a role in how the months after Eid will play out. 'UCIC's weak debut, the only IPO this year to close lower on day one, reflects broader investor caution driven in large part by renewed global trade tensions. The reintroduction of US tariffs under the Trump campaign narrative has sparked uncertainty across markets, especially in regions heavily linked to global trade flows, like the Gulf,' Valecha said. (Reporting by Bindu Rai, editing by Seban Scaria)
Zawya
6 days ago
- Business
- Zawya
Valuation concerns, profit booking weigh on United Carton's debut trade on Tadawul
Shares of Saudi Arabia's United Carton Industries Company (UCIC) closed flat on Tuesday's trading debut, with tariff threats, along with profit booking and overstretched valuations turning away investors, according to analysts. Despite being nine times oversubscribed and raising proceeds to the tune of 600 million Saudi Arabian riyals ($160 million), the stock closed lower by 1.5% at 49.25 riyals per share, as against its offer price of 50 riyals. The mixed performance was also visible on Wednesday with the stock dropping to lows of SAR 46.60 in early trade, with the last trade settling at SAR 46.85 by 2.30pm local time. Vijay Valecha, Chief Investment Officer, at UAE brokerage Century Financial said that even though the stock opened 6% higher at 53 riyals apiece and had rallied as much as 9% later during the day, 'signalling strong investor interest and participation in the IPO,' the stock's overall performance was a result of a confluence of factors, 'chief among them being concerns around valuation.' 'With a market capitalisation of approximately SAR 2 billion and operating earnings of SAR 124.7 million in 2024, the company is trading at a price-to-earnings multiple of 16.16x — notably above the Asia Pacific (developed) industry median of 13.53x. This premium may have tempered investor appetite at the time of listing,' Valecha explained. He continued: 'Additionally, the stock may have closed lower after a round of profit-booking, as some IPO participants were likely short-term traders aiming to capitalise on immediate listing gains rather than holding for long-term value. Lastly, although the company has limited direct exposure to [US President Donald] Trump's tariffs, its industry could face some indirect pressures in the form of elevated input costs and softer demand from international customers impacted by tariffs.' Profit booking UCIC shares opened at SAR 53 and hit a high of SAR 54.5 within the first five minutes of trading before finally closing at a low of SAR 50.5 on day one. Trading volume exceeded 17 million shares, representing approximately 1.5 times the 12 million secondary shares offered. 'It must be noted that the volume in the first five minutes was at 1.68 million shares. For comparison, the IPO was for about 12 million or 30% of the company's total issued share capital, meaning that about 14% of the company's floating shares were traded within the first five minutes alone. Given this, there was an immense profit booking after the price hit the high mark of SAR 54,' Valecha said. Added pressures emerged from the 'slightly stretched valuations,' he added. 'UCIC is a corrugated company in the Developed Asia Pacific region. The median P/E ratio of the listed companies operating in the containers and packaging segment is approximately 13.5. Meanwhile, the P/E ratio for UCIC is approximately 16.2 (market cap of SAR 2.016 billion / net income from operations of SAR 124.7 million). This implies that UCIC is slightly overvalued in comparison to its peers.' Flynas, SMC IPO Following the UCIC debut, all eyes are on the Saudi Flynas IPO, with Specialized Medical Company (SMC) close behind. 'The market could find support as it continues to see strong interest in Saudi IPOs, including the upcoming Flynas listing. Successful IPOs could help attract local and international capital to the stock market, which could help stabilise prices,' Valecha said. 'The SAR 4.1 billion IPO of Flynas, which opened today for retail participation, while being about 100 times subscribed by institutions, indicates massive investor demand,' said Valecha. 'On the other hand, Specialized Medical Company (SMC) extended its book-building period to allow qualified investors to review their bids, while postponing the retail offering period to June 15.' SMC has though confirmed its commitment to the IPO, stating the listing remains on track, and the business fundamentals and long-term growth strategy remain unchanged. One deal still awaiting an intention to float is Ejada Systems, with its Capital Market Authority approval expiring on June 23. (Writing by Bindu Rai, editing by Seban Scaria)
Argaam
7 days ago
- Business
- Argaam
UCIC debuts on TASI today at SAR 50/share
United Carton Industries Co. (UCIC) starts trading on the Main Market (TASI) today, May 27, under the symbol 1323 and ISIN Code SA16AGP0KLH7, at a price of SAR 50 per share. The stock will trade in the first three days with daily and static price fluctuation limits of ±30% and ±10%, respectively. From the fourth trading day onwards, the daily price fluctuation limits will revert to ±10%, while the static price fluctuation limits will no longer apply. For More IPOs UCIC is the sixth listing on TASI in 2025 after Almoosa Health Co. on Jan. 7, Nice One Beauty Digital Marketing Co. on Jan. 8, Derayah Financial Co. on March 10, Arabian Company for Agricultural & Industrial Investments (Entaj) on March 17 and Umm Al Qura for Development and Construction Co. (UQDC) on March 24. In 2024, 13 companies listed on Tadawul, in addition to Alistithmar AREIC Diversified REIT Fund. Following UCIC listing, the number of companies listed on TASI reached 235, along with 19 real estate traded funds. The company offered 12 million shares, or 30% of its capital, on TASI. It allocated 80% of the shares on offer to institutional investors, while the remaining 20% was set aside for retail investors. The retail IPO was 8.9x covered, with retail requests of nearly SAR 1.07 billion. Meanwhile, institutional IPO was 126x oversubscribed. A minimum of six shares was allocated to each investor, while the remaining shares will be allocated on pro rata, with an average allocation factor of 0.1072%. Company info UCIC is a closed joint-stock company in Saudi Arabia, established in 1988 in Jeddah. The company's capital is SAR 400 million, divided into 40 million shares at a par value of SAR 10 per share. Company Shareholders Shareholders Before IPO After IPO Number of Shares (mln) Ownership (%) Number of Shares (mln) Ownership (%) Zamil Group Holding* 12.00 30.0 % 8.40 21.0 % Omar Kassem Alesayi & Co. 12.00 30.0 % 8.40 21.0 % Frimex Investment 12.00 30.0 % 8.40 21.0 % Zamil Group Investment Co. 2.00 5.0 % 1.40 3.5 % Eastern Industrial Investment** 2.00 5.0 % 1.40 3.5 % Public -- -- 12.00 30.0 % Total 40.00 100 % 40.00 100 % *Zamil Group Holding fully owns Zamil Group Investment Co.
Zawya
26-05-2025
- Business
- Zawya
Saudi Arabia's UCIC to debut on Tadawul on May 27
Saudi Arabia's United Carton Industries Company's (UCIC) 600 million Saudi riyal ($160 million) IPO will debut on the Main Market on May 27, in what will be the sixth listing on Tadawul this year. The cardboard packaging manufacturer set the final IPO price at SAR 50 per share, implying a market capitalisation of SAR 2 billion at listing. CEO Mohnish Rikhy said the proceeds from the IPO will allow UCIC to scale operations and expand its product portfolio. (Writing by Bindu Rai, editing by Brinda Darasha)
Argaam
26-05-2025
- Business
- Argaam
UCIC shares to debut on TASI on May 27
The Saudi Exchange (Tadawul) announced that shares of United Carton Industries Co. (UCIC) will be listed and start trading on the Main Market (TASI) on May 27, with the symbol 1323 and ISIN Code SA16AGP0KLH7. The stock will trade with daily and static price fluctuation limits of +/- 30% and +/- 10%, respectively during the first three days of listing. From the fourth trading day onwards, the daily price fluctuation limits will revert to +/- 10% and the static price fluctuation limits will no longer apply. In a separate statement, the Securities Depository Center Co. (Edaa) announced the deposit of UCIC subscribed securities into the accounts of eligible shareholders today, May 26. UCIC issued 2.4 million shares to retail investors, representing 20% of the total offered shares of 12 million, at SAR 50 each, according to data available with Argaam. The institutional offering was nearly 126x covered, while the retail subscription was 8.9x covered. As many as 396,600 retail subscribers injected about SAR 1.07 billion. The company operates with SAR 400 million in capital, divided into 40 million shares, at a nominal value of SAR 10 each.
