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Sembcorp Salalah shares soar over 24pc on debut
A. E. JAMES
October 08, 2013 , 8 : 52 pm GST
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A view of the Muscat Securities Market logo. Supplied photo
The shares of Sembcorp Salalah Power & Water Company soared 24.53 per cent to close at OMR1.980 on hectic demand on the first day of listing on the Muscat Securities Market (MSM).
The company's share gained 390 baisas or 24.53 per cent compared to its offer price of OMR1.590 per share, amid demand for 11.03 million shares on debut. The share touched a high of OMR2 when the trading started, but declined to a low of OMR1.910 before setting down at OMR1.980.
"Demand for utility stocks (which offers a stable dividend), along with better market sentiment helped the company for a successful listing of the shares on the MSM," said Kanaga Sundar, head of research at Gulf Baader Capital Markets.
"There was a clear demand from local institutions that are looking for stocks that offer attractive and stable dividend. Retailers were on the selling side," he added.
Sundar said the robust gain on the first day helped to improve the overall market sentiment and the prospects of other firms that plan initial public offering.
The trading of Sembcorp shares was not highly volatile as the range was only 90 baisas for a trading of more than 11 million shares. "Normally such trading witnesses huge volatility," he added.
Sundar also noted that almost 33 per cent of the total size of the issue was traded on the bourse. "Most of the retailers must have sold their holding of Sembcorp Salalah," added another broker.
As many as 95.46 million shares will be listed on the Muscat Securities Market. The share is likely to witness range bound trading in the coming days. The company's promoters offered 35 per cent of their holding at a price of OMR1.590 per share through a one-month long subscription between August 28 and September 26.
The company's OMR53 million-IPO was oversubscribed by 8.3 times, making it the largest in Oman this year.
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