Saudi’s Lumi prices IPO at top of range

Company aimed to achieve SAR1 bn in revenues prior share offering
Saudi’s Lumi prices IPO at top of range
Lumi (Photo from Lumi)

Saudi’s Lumi Car Rental Company has announced that its one-day subscription period will commence next Tuesday. The company has set the final offering price for its stock at the top of range, which is 66 riyals per share.

The book building process has been successfully completed, witnessing a significant participation from enterprises eager to subscribe to the shares of the company that will be listed on the main market of the Saudi stock exchange.

The offering of 16.5 million shares, equivalent to 30 percent of the company’s capital, had a price range initially set between 62 riyals and 66 riyals per share. As a result, the final offering price has been determined at the upper limit of 66 riyals per share.

Read more: MENA IPO down in H1 2023, but experts still bullish

Having been founded in 2006, Lumi has recently appointed Saudi Fransi Capital (SFC) a financial adviser, lead manager, and underwriter to oversee the offering process. Additionally, SFC and EFG Hermes KSA have also been appointed as institutional joint bookrunners.

Established by Seera Group Holding, Lumi offers long-term lease services to corporate and government sector clients, short-term car rentals across a network of 35 airport and city branches in the Kingdom, and used car sales.

Seera, a Saudi travel company formerly known as Al Tayyar Travel Group, is the sole owner of Lumi. 

The auto rental firm ranked itself as the third-biggest operator in the country with a market share of about 7 percent, based on its fleet size in 2021, according to its IPO prospectus.

Current valuation

According to Mohammed bin Saleh Al-Khalil, chairman of Lumi, the current valuation of the company stands at approximately 1 billion riyals.

Azfar Shakeel, the CEO of Lumi, the price range for the IPO of the company’s shares is determined by a profitability multiple of 14 to 16 times, based on the projected profits for the current year.

Furthermore, Shakeel mentioned that the company aimed to achieve revenues of 1 billion riyals prior to proceeding with the offering of its shares.

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