Newly listed shares of the retail division of Dubai's Emaar Properties soared on their first day of trading Thursday, highlighting rising confidence in the Gulf emirate's market after a crisis-triggered slump.
The group, which owns the Dubai Mall, one of the world's largest shopping centres, carried out an initial offering of shares to the public last month aiming to raise $1.58 billion (1.24 billion euros).
Demand from institutional investors in what was the largest IPO in the United Arab Emirates since the global financial crisis struck in 2009, was 30 times higher than the number of shares on offer.
Sold ahead of their listing on the Dubai stock exchange at the top offered price of 2.90 dirhams ($0.79), Emaar Malls Group shares jumped 20 percent to around 3.50 dirhams at Thursday's opening.
They ended the day at 3.25 dirhams, for a gain of 12.07 percent.
That price puts market capitalisation at approximately 37.7 billion dirhams, the group said in a statement posted on the Dubai Financial Market website.
With demand 30 times oversubscribed among institutions and 20 times among individuals, the final allocation was 70-30, the group said.
"Institutional investments represent a testimony. Those make calculated decisions based on studies, and are not emotional," said financial analyst Ziad Dabbas, adding that allocating 70 percent to institutions was a "smart move."
"They have the financial liquidity, and they do not follow rumours in their action," he said.
- 'Surpassed our greatest expectations' -
Emaar Malls chairman Mohamed Alabbar, who led the bell-ringing ceremony kicking off Thursday's trade, said "the response from investors to the offering has surpassed our greatest expectations."
It is a "testament to the confidence in the Emaar Malls business and the UAE's financial markets," he said.
After soaring 107.8 percent in 2013, the Dubai Financial Market Index surged another 49.6 percent in the first nine months of this year, despite a mid-year hiccough caused by profit taking.
Financial expert Wadah Taha said the "level of confidence in the economy of Dubai" boosted interest in the IPO. In particular, he noted a rise in interest from foreign investors following the May upgrade of UAE stock markets from "frontier markets" to "emerging markets" status.  
Taha also pointed to the "lesser risks" connected to Emaar Malls' business, as well as a flourishing tourism sector that could only mean better business.
A rise in bank assets and liquidity, which has brought interest rates down, has provided a suitable environment for companies seeking to raise capital, he added.
"IPOs create depth in the market, reduce the possibilities of inflation and add to diversification," Taha said.
Dabbas said the "market needs opportunities. Successful government companies and large family businesses should partially open up through public offers.       
Emaar Properties, the parent group of EM, is the largest listed company on the Dubai Financial Market. It was behind several landmark property developments, including the world's tallest tower, Burj Khalifa.
Dubai Mall had 74.8 million visitors in 2013, a number reaching 40 million in the first six months of this year.
Dubai's economy has made a strong comeback since the global financial crisis, thanks to growth in trade, transport and tourism.
Source: AFP