Lumi’s retail IPO tranche orders hit $333m

Saudi-based car rental company Lumi said the retail tranche of its initial public offering (IPO) was oversubscribed 11.5 times, with demand reaching SAR1.25 billion ($333.25 million).

The retail subscription, which took place on September 12, was subscribed by 124,888 investors. It comprised 1,650,000 shares, representing 10 percent of the total offering.

Based on the results of the retail subscription, the shares allocated to institutional investors will be scaled back to 14,850,000, representing 90 percent of the total offer shares, the company said in a statement.

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The final offer price was SAR66, giving the company a valuation of SAR3.63 billion.

The institutional book-building period ended on September 5.

Following regulatory approvals, the listing will take place on the Saudi Exchange (Tadawul).

Saudi Fransi Capital has been appointed financial advisor, lead manager, bookrunner and underwriter.

Lumi chairman Mohammed Al Khalil, said: “The IPO provides an opportunity for investors to participate in a sector that is benefitting from powerful macroeconomic and structural tailwinds and is positioned for significant growth.

“With our own growth accelerating, this is an exciting time to invite investors to share in our onward journey of success.”

Lumi reported a profit of SAR100 million in the first half of 2023, rising 39 percent from SAR72 million in the same period last year.

Revenue rose 48.6 percent year on year to SAR500 million in the first six months to June 30, 2023.

The company’s fleet grew to 24,730 by the end of April from more than 19,600 at the end of September 2022, the prospectus said.

Saudi Arabia’s car rental market is forecast to rise at a compound annual growth rate of 8.6 percent up to 2027 to reach SAR 9.8 billion, according to Glasgow Research & Consulting data.