Omani Nawras up 5.4pct on debut, low retail demand

Omani telecoms company Nawras surged more than 5 per cent on its bourse debut on Monday, as institutions took up a slack in demand among retail investors during a sticky initial public offering.

Chief Executive Ross Cormack said retail investors made up only 27 per cent of subscribers to the IPO.

Nawras had reserved up to 70 per cent of the offer for retail investors, who are usually more active then institutional investors in the region. In October, it extended the IPO period by a week due to tepid retail demand.

Institutions stepped in to cover the remaining 73 per cent of the sultanate's first IPO through a book-building process, Cormack told Reuters in a phone interview on Monday.

Shares in Nawras surged 5.4 per cent to close at 0.741 rials on Monday, outperforming the broader index, down 0.2 per cent.

"It's the first time in Oman that we have not seen much appetite from retail investors for an IPO," Adel Nasr of United Securities in Muscat, said.

"Investors are unfamiliar with the book-building process and subscribing at an unknown price. But on Monday we saw ... retail investors trying to buy the stock after failing to do so in the IPO."

Nasr said institutions are responsible for between 40 and 54 per cent of daily volume on the Muscat bourse, and retail investors the rest. "So retail investors are significant for the market," he said.

A unit of Qatar Telecommunications (Qtel), Nawras raised 182 million rials ($472.6 million) from the IPO after the offer priced at the bottom of its range at 0.702 rials per share.