A Dubai Company That Doesn't Do Any Business Yet Had A 59% Surge On Its First Day Of Trading

Marka surged 59% in its first day as a public company in Dubai.

According to Bloomberg’s Sarmad Khan, this was first IPO on the Dubai Financial Market in five years.

Data from the Dubai Financial Market shows that shares of Marka were priced at 1 U.A.E. dirham, debuted at 1.77, and closed at 1.59 dirhams in their first day of trading.

Marka says it hasn’t started operations yet but, “its principal activities will be operation of retail stores dealing in luxury apparel, accessories, sports merchandise and airport concessions, as well as restaurants and cafes of mid to high end dining options across global cuisines.”

So they want to open malls.

You could also call this company a SPAC, or special-purpose acquisition company. According to a report in Gulf News, Chimera Investment Corporation, which is listed in the US under the ticker CIM, holds a 5% stake in Marka.

The company’s most recent financial statements are pretty sparse, with the company reporting a net loss for the period from June 23 to August 31 of 1.2 million dirhams.

One US dollar is worth about 3.7 dirhams.

The Wall Street Journal’s Asa Fitch gives a great overview of the Dubai markets in her report on Marka’s IPO.

Fitch writes: “The fast start to trading ‘reflects the trust of the investors in the company’ [the company’s chairman said]…It also may reflect the general mood in the market. The DFM was one of the world’s worst-performing markets during the global financial crisis, but has recently seen its fortunes turn in dramatic fashion. The index more than doubled last year, and is up by a further 50% so far this year.”

But: “Many of the U.A.E.’s investors are individuals whose strategies involve little more than seeking quick gains based on technical charts and market rumours — speculators, basically,” Fitch writes.

And so while stocks in Dubai might be up broadly this year, the market also saw several huge sell-offs during the summer.

NOW WATCH: Money & Markets videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.