IPO Valuation, Price-Setting, and Stabilization Mechanisms in the Egyptian Capital Market

Mahmoud Otaify

Chapter 13 in Handbook of Banking and Finance in the MENA Region, 2024, pp 331-352 from World Scientific Publishing Co. Pte. Ltd.

Abstract: This chapter discusses the Egyptian regulatory framework of the IPO process as well as its listing on the Egyptian Exchange (EGX). We will examine the most recent IPOs executed in the Egyptian capital market during the period of 2016–2022 to identify the valuation, pricing, and stabilization mechanisms used by investment banks in light of Egyptian laws and regulations. We use descriptive analysis for the IPO structure data to implicitly identify the incentives to go public. Interestingly, all shares offered in the Egyptian IPOs during the period of concern are secondary offerings, so Egyptian IPO firms use the capital market as an exit strategy rather than to finance expansion. A discounted cash flow model and trading multiples are the techniques most applied in the IPO valuation. The book-building pricing mechanism is widely used by investment banks in the Egyptian IPO market.

Keywords: MENA; Banking Sector; Business Risk; Corporate Governance; COVID-19; Cryptocurrency; Fintech; Financial Stability; Green Finance (search for similar items in EconPapers)
JEL-codes: F3 G2 G3 (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.worldscientific.com/doi/pdf/10.1142/9781800614734_0013 (application/pdf)
https://www.worldscientific.com/doi/abs/10.1142/9781800614734_0013 (text/html)
Ebook Access is available upon purchase.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wsi:wschap:9781800614734_0013

Ordering information: This item can be ordered from

Access Statistics for this chapter

More chapters in World Scientific Book Chapters from World Scientific Publishing Co. Pte. Ltd.
Bibliographic data for series maintained by Tai Tone Lim ().