The Egyptian stock exchange expects more initial public offerings (IPOs) in the first quarter of 2008 after strong demand for real estate developer Talaat Mustafa Group, a senior market official said.
Maged Shawky, chairman of the Cairo and Alexandria Stock Exchange, told Reuters in an interview that several investment banks planning new IPOs had already contacted him.
"But the execution will wait for the January-March (period), between Christmas and Easter," he said. "The Talaat Mustafa IPO success seems to have encouraged more newcomers."
The Egyptian real estate firm's public offer of 65 million shares worth 715 million Egyptian pounds ($129.3 million), was covered 41.4 times. An earlier private placement of 330 million shares was 17 times oversubscribed, making it the biggest of its kind in Egypt, Shawky said.
Shares in Talaat Mustafa ended their first trading day on November 28 at 13.55 Egyptian pounds, 23 percent above their IPO price. On Thursday they lost 5 percent to 12.90 pounds.
Shawky said the relatively small first-day premium, compared with Telecom Egypt which initially doubled in value on its IPO in December 2005 before losing those gains in the following week, showed the market was becoming more sophisticated. "It means the market is more mature and that market discipline, and not the regulator, is leading the action," he said.
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