UAE: Salik IPO Participants in the UAE See Profitable Returns

Early on in Salik's 2022 initial public offering (IPO), Dean Fernandes was an investor in the road toll operator based in Dubai.

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With the shares now valued at over Dh3,300, he made a big profit on his initial investment of just over Dh2,000. Fernandes, who has lived in Dubai for a long time, was optimistic about the shares' prospects from the beginning. As soon as word leaked out about the IPO, he jumped at the chance to invest, confident that share value would rise gradually.

Dean's experience is reflective of many UAE residents who participated in Salik's IPO and are now enjoying profitable returns. Upon its debut, the shares surged 20 percent above their listing price, and subsequent announcements, such as the establishment of two new toll gates in Dubai, further boosted share prices by 35 percent.

For A. Iqbal, the decision to invest in the IPO was influenced by his teenage daughter's astute reasoning. Recognising the widespread usage of Salik among thousands of vehicles daily, Iqbal's daughter argued convincingly for the investment's potential. Salik's IPO, launched in September 2022, saw overwhelming demand, attracting over Dh184 billion in subscriptions and oversubscribing 49 times.

Although Iqbal initially bid Dh5,000, she ultimately settled for Dh2,000 worth of shares due to oversubscription. Despite concerns about increased toll expenses due to his daily commute on Sheikh Zayed Road, Iqbal anticipates that share values will rise along with expenditures.

However, not all investors share the same optimism regarding the impact of new toll gates on traffic congestion. Navya Muraly, another shareholder, is sceptical about potential increases in taxi fares and additional expenses resulting from the new toll gates. While hopeful for higher returns on her shares, she acknowledges the unpredictable nature of the market but remains confident in Salik's stability as a semi-governmental entity.

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