Talabat share price falls on DFM trading debut after $2 billion IPO

Food delivery company's listing attracted strong investor interest with a double-digit oversubscription level

Frankfurt-listed Delivery Hero retains a majority interest in Talabat. Chris Whiteoak / The National

Food delivery company Talabat Holding’s shares rose nearly 7 per cent in the morning session on the first day of trading, after the company raised Dh7.5 billion ($2.04 billion) in the Gulf's largest initial public offering this year.

However, the stock, trading under the ticker symbol “TALABAT” on the Dubai Financial Market (DFM), reversed course in midday trading and closed 6.8 per cent lower at Dh1.49 on Tuesday, below the final offer price of Dh1.60 per share.

The offering, which Talabat said was “the largest global technology IPO in 2024 to date”, attracted a double-digit oversubscription level last month.

"Today marks the start of an exciting new chapter for Talabat and the region’s wider tech sector, and we are delighted to be welcoming new shareholders to be a part of our ambitious road map for the future,” Tomaso Rodriguez, the company's chief executive, said in a statement on Tuesday.

Talabat, which offers delivery of food, groceries and convenience retail, has operations in the UAE, Kuwait, Qatar, Bahrain, Egypt, Oman, Jordan and Iraq. In September, its platform had more than six million active customers, more than 65,000 participating restaurants, grocers and other vendors. It also had about 119,000 riders.

Talabat joins a growing list of regional companies raising funds through listings. Photo: Joint Committee for Traffic Safety

Frankfurt-listed Delivery Hero retains a majority interest in Talabat, which has post-listing plans to pay a minimum dividend of about $100 million in April next year for the fourth quarter of this year. The company will pay $400 million in two instalments in October and April 2026 for the financial results of 2025, the company said in September.

"As a leader in food delivery and e-commerce in Mena, Talabat’s focus on improving offerings within existing markets should drive customer retention and higher order values," George Pavel, general manager at Naga Middle East, told The National. "The positive investor sentiment around the IPO, along with plans for dividend distributions, further supports Talabat’s long-term growth."

Talabat joins a growing list of regional companies raising funds through listings amid continued economic momentum in the region. In the third quarter of this year, the aggregate value of IPO proceeds rose to $904 million, compared with $523 million from six deals in the three-month period last year, global consultancy PwC said in the Q3 2024 IPO Watch report.

In the UAE, the Arab world's second- largest economy, listing activity has remained robust over the past few years.

Talabat's listing comes after Lulu Group’s shares debuted on the Abu Dhabi Securities Exchange (ADX) last month, when the company raised Dh6.32 billion from its IPO.

DFM, the UAE's second-largest stock market after ADX, is committed to attracting "prominent private-sector companies to list, further diversifying investment opportunities for both regional and international investors," said Helal Al Marri, chairman of the DFM board of directors.