21.01.2022

Getting listed on the Dubai Financial Market.

What is the Dubai Financial Market ?

The Dubai Financial Market (DFM) was established as a public institution in 2000. The Executive Council Decree of 2005 set the DFM as a Public Joint Stock Company. 

It is an onshore financial exchange markets and is subject to the supervisory authority of the UAE Securities and Commodities Authority (SCA). The SCA has authority to impose laws, regulations, and standards with which the DFM must comply.

The DFM is the first financial market in the world to comply with Islamic Sharia rules. It deals in debt instruments, equity instruments, Exchange Traded Funds (ETFs) and securities lending and borrowing. 

Why should you go public?

Being listed in a capital market provides the issuing entity to have an enhanced access to capital, a dominant global presence and a minimum assured liquidity. It also encourages the company to transform itself into a more efficient and sustainable business model. 

Going public on a financial exchange has the following benefits:

• Ongoing access to capital: Publicly listed companies have an enhanced access to both, equity and debt capital markets.
• Liquid and transparent market for shares: Having a transparently valued company facilitates all capital market related transactions a listed company may take. 
• Enhanced public profile: Being registered on a well established financial exchange strengthens the company’s credibility, image and visibility. 
• Opportunity to improve business: The diligence carried out during the IPO process provides the business to evaluated by industry specialists and, put in place effective internal processes and controls.
• Attract talent: The recognition gained by getting listed attracts talented individuals from the industry, especially if there is quit-based compensation, so they would benefit alongside the financial success of the company. 
• Succession planning: An IPO provides an opportunity for a gradual transfer of control to professional management personnel, board of directors and ultimately the shareholders.

Things to consider when choosing to go public

The Initial Public Offering (IPO) of a company is no easy task, before doing so the following things must be considered: 

1. Offer structure: The offer size, pricing and capital structure.
2. Marketing and Communication Strategy
3. Timing
4. Legal Structure 
5. Liaising with regulators: engaging with the respective regulators such as SCA, the relevant Department of Economic Development and DFM
6. Pricing: whether it will be Fixed Price IPO Offering or Book-Built IPO Offering 
7. Corporate Governance: the governance framework of the company

Why should you chose to list on the DFM ?

The DFM is the most dynamic financial market in the Middle East. Being based in the region’s financial hub, Dubai, provides it with diverse portfolio in international trade, banking and finance, infrastructure, technology and tourism. 

In 2007, DFM became the first exchange, in the region, to be publicly listed while complying with sharia’ principles. The DFM had its position further strengthened when it consolidated its operation with Nasdaq Dubai. The consolidation allows investors an even greater choice of asset classes and an easier access to DFM and Nasdaq Dubai listed securities via a single investor Number. This provides for a seamless experience across the two exchanges. The DFM has witnessed growth through developing a number of key international and regional strategic partnerships and adapting to the best practices. 

DFM has built a reputation of being a leader in market infrastructure, innovation, Financial service and excellence in capital markets across the region and shares expertise with other regional exchanges.

Moreover, what makes DFM exceptionally distinct from other capital markets is technology. The DFM has by far the most advanced trading engines globally, the Nasdaq X-Stream. It is capable of handling multiple asset classes listings, such as equities, fixed income, and derivatives of multiple currencies. Furthermore, the current system is capable of handling up to 200 times its current average market activity and volume. It shows the DFM is here to stay and intends to grow by at least 200 times. Your company could grow as the DFM grows. This is something only the DFM can provide as all other established trading platforms are highly saturated.

The DFM has a very customer centric approach. It provides all the assistance required and expected from a capital market, and a little more. Firstly, it has an Issuer Support Program, under which, an experienced DFM IPO team guides you through the various stages of the listing process with DFM and the SCA. Secondly, there are the Innovative Issuer Services, DFM provides numerous values adding services, such as; electronic shareholders reports, dividend distribution services, etc., for its listed companies. Lastly, the DFM provides its listed companies various opportunities to increase their corporate awareness and visibility among global institutions and investors.

Requirements for Listing on DFM (2025)

Legal & regulatory eligibility: Issuers must be companies eligible under the DFM Listing Rules and the UAE Securities and Commodities Authority (SCA) framework—typically Public Joint Stock Companies (PJSCs), qualifying foreign equivalents, or eligible Free Zone entities—complying with SCA regulations and DFM Market Rules. Companies must adhere to ongoing disclosure, governance and trading-system rules set by DFM and SCA.

Market category thresholds (Main Market): For a Category One listing/continuation on the Main Market, DFM’s 5 February, 2025 amendments require: (i) ≥100 shareholders; (ii) free float ≥20% of paid-up capital; (iii) fully paid-up share capital; (iv) net shareholders’ equity at least 100% of paid-up capital; (v) no trading suspension; and (vi) the company made a profit in the financial year preceding the Market’s review. Falling below these can lead to Category Two status (e.g., free float <20%, trading suspension ≥6 months, or accumulated losses ≥50% of share capital). DFM may disregard the 20% free-float test for large caps (≥AED 500 million) where liquidity is otherwise adequate.

Financial track record & audited statements: Applicants must present audited annual financial statements that meet DFM/SCA standards. For Private Market listings, DFM’s 2025 update explicitly requires audited annual financials for at least two years of operations before the establishment of the Private Company (i.e., continuity and verifiable track record). Expect IFRS-compliant audits by SCA-approved auditors and timely interim reporting post-listing.

Minimum share capital, free float, and number of shareholders: While DFM does not prescribe a single universal minimum paid-up capital across all applicants, classification and admission hinge on the free-float (≥20%) and shareholder count (≥100) for Category One, with the AED 500 million large-cap relief available at DFM’s discretion. Private Market (Direct Market) listings typically require a minimum of 30 shareholders at the time of listing.

Ongoing compliance expectations: After Admission, issuers must keep free float and shareholder dispersion at or above thresholds, maintain equity above paid-up capital, publish timely disclosures, and avoid extended suspensions. Breaches can trigger re-classification to Category Two or additional remedial requirements.

Alignment with the SCA regime: All listings on DFM operate within the federal SCA regime (listing, disclosure, and continuing obligations). Issuers should map their constitutional documents, corporate governance, insider-list procedures, and financial reporting calendars to SCA and DFM requirements before filing to avoid delays

Process Step-by-Step

1) Pre-application readiness (6–12 weeks)

Form your IPO steering team (CFO, legal counsel, auditors, financial adviser/underwriter). Map eligibility to DFM & SCA rules: corporate form (typically PJSC or qualifying foreign/free-zone equivalent), governance, insider lists, and disclosure procedures. Align capital structure and free float/dispersion to Main-Market thresholds (e.g., ≥20% free float and ≥100 shareholders for Category One) or plan for Category Two where applicable. Start audit uplifts and IFRS clean-up; prepare two years of audited financial statements (or, for Private Company listings, provide two-year financials at company/subsidiary level per 2025 update). Secure board/shareholder approvals to list and offer.

2) Regulatory scoping (2–4 weeks, overlaps with Step 1).

Hold pre-filing discussions with advisers to confirm whether you fit the Main Market Category One/Two or the Private Market and to validate any large-cap waiver considerations for free float/liquidity. Align with SCA’s listing/disclosure regime and prospectus expectations (working-capital statement, risk factors, MD&A).

3) Drafting & diligence (4–8 weeks).

Produce core documents: constitutional documents, board/shareholder resolutions, audited annual FS (last two years) and latest interims, comfort letters from auditors, corporate governance charter, insider/related-party registers, legal due diligence reports, underwriting/advisory mandates, and the prospectus/offering document (Arabic/English as applicable). Private Market applicants compile the tailored package noted in DFM’s 2025 circular.

4) Application submission (Day 0)

Submit the listing application to DFM together with required forms and disclosures; SCA approval is a prerequisite to listing and to offer securities to the public. In practice, filings run in parallel (SCA for approval of the prospectus/offering and DFM for Admission to trading).

5) Regulatory review (2–6 weeks)

SCA reviews the prospectus and disclosures; DFM assesses market-admission criteria, including category placement (One/Two), free-float and shareholder dispersion, trading eligibility, and any reliance on the ≥AED 500m large-cap free-float relief. Regulators may issue Q&As requiring clarifications, supplemental risk factors, or updated financials (e.g., stub-period interims).

6) Approvals & pricing (1–2 weeks)

Upon SCA approval and DFM admission decision, finalise price mechanism (fixed-price or book-build), allocation policy, and publication date. Complete settlement/clearing arrangements with Dubai Clear and the CSD; confirm ticker, ISIN, and corporate actions timetable.

7) Marketing & investor education (1–2 weeks)

Conduct roadshows and publish the approved prospectus. Monitor investor feedback and subscription progress; ensure all public communications remain within SCA/DFM disclosure boundaries.

8) Listing & first day of trading

Satisfy any final conditions (free-float achieved, shareholder count verified, publication formalities). Securities are admitted to trading on the DFM Main Market (Category One/Two) or the Private Market, subject to approval. Post-listing, comply with continuing obligations (periodic/inside-information disclosures, free-float/dispersion monitoring, and suspension-avoidance).

Costs & Timeframes

Direct exchange and regulatory fees (DFM/SCA): DFM charges initial listing fees based on paid-up capital: AED 18,000 (≤ AED 500m), AED 30,000 (> AED 500m to AED 2bn), and AED 60,000 (> AED 2bn). Annual fees mirror these bands at AED 21,000, AED 35,000, and AED 70,000, respectively. Common add-ons include XBRL registration (AED 10,000), EFSAH registration (AED 2,000) plus user fees, with equivalent annual charges (e.g., XBRL AED 10,000). Bond/sukuk and fund listings have separate, lower fee lines. Note that DFM periodically updates its fee circulars (e.g., 23 July 2025 amendment).

Advisory, legal, audit and underwriting: The most significant single external cost is typically underwriting, which globally averages ~4–7% of gross proceeds (Market, deal size and structure dependent). UAE deals may price below or within this range, depending on issuer profile and allocation method. Additional major cost buckets include: legal counsel (issuer and underwriters), financial adviser/IPO coordinator, auditors (IFRS audits, comfort letters), PR/investor relations, prospectus translation/printing, and registrar/CSD/settlement setup. These amounts are engagement-specific and scale with complexity and offer size.

Minimum vs typical timelines: With a ready issuer (clean audits, governance in place), the regulatory review window after filing is commonly ~2–6 weeks for SCA prospectus approval and DFM admission, subject to Q&A rounds. However, total IPO readiness to listing often spans 4–9 months when including pre-filing work (audit uplifts, corporate actions, board/shareholder approvals, marketing prep). Market commentators note that UAE IPOs can take up to ~12 months end-to-end for first-timers or complex conversions. Firms should also plan for ongoing periodic reporting (audited annual FS within 90 days; interims within 45 days).

Key drivers of cost and time: Readiness gaps (IFRS remediation), free-float/shareholder dispersion adjustments, offer structure (fixed-price vs book-build), and regulator feedback loops most influence duration and external spend. Early scoping with advisers and pre-consultation with DFM/SCA compresses the timetable and reduces iteration risk.

Challenges & Common Pitfalls

Keeping pace with regulatory change: DFM and SCA periodically update listing, disclosure, and corporate-governance rules. Companies that treat the rulebook as static often face late rework—new free-float interpretations, insider-list procedures, or XBRL/structured-reporting tweaks can trigger fresh review rounds. Assign an internal owner to track circulars and align advisers early.

Underestimating disclosure depth: Prospectus drafting isn’t a “data dump.” It needs clear MD&A, KPIs, liquidity analysis, working-capital statements, related-party transparency, and risk factors tailored to the business model (customer concentration, concession risk, FX, commodity exposure). Thin or generic disclosure leads to regulator Q&As, delays, and credibility drag with investors.

Financial readiness gaps: IFRS clean-ups, segment re-cuts, and audit “comfort” often take longer than expected—especially for carve-outs, family groups, or fast-growing firms with legacy controls. Missing audit schedules, revenue-recognition issues, or weak consolidation can stall the timetable and add audit fees.

Free-float and shareholder dispersion: Hitting the minimum float and holder count on paper is not enough; you must demonstrate a tradable float and avoid concentrated allocations that jeopardise liquidity post-listing. A poor allocation strategy can push you into a less favourable category or invite post-listing volatility.

Timelines and cost realism: Teams frequently budget for fees but overlook internal costs (finance upgrades, IR content, website and disclosure tooling, governance uplift, board training). Slippage often occurs around prospectus Q&A cycles and last-minute financial updates (e.g., new interim period).

Investor demand misreads: Overreliance on headline sector sentiment without price-sensitivity testing risks weak coverage or pricing cuts. For first-time issuers, limited research coverage and thin pre-marketing can depress book quality.

Communications and publicity risk: Pre-deal marketing that strays beyond approved disclosures can invite regulatory scrutiny. Ensure all roadshow and media materials match the cleared prospectus.

Post-listing obligations: After day one, issuers stumble on periodic/inside-information disclosures, blackout discipline, and maintaining float/dispersion. Build an IR calendar, disclosure committee, and monitoring dashboards before listing to prevent compliance drift.

Case Studies / Recent Examples

• Parkin (DFM, March 2024): Dubai’s parking operator sold 24.99% via a book-built IPO with a price range of AED 2.00–2.10, then listed on DFM on 21 March 2024. The deal formed part of Dubai’s ongoing privatisation pipeline; advisers included Rothschild (IFA) with joint global coordinators from leading banks. The offer structure and strong municipal backing helped anchor demand and price discovery.
• Spinneys (1961 Holding PLC) (DFM, May 2024): The UAE grocer offered shares through a book-build, disclosing a price range of AED 1.42–1.53 and setting Admission for 9 May 2024. Staged tranche windows for retail and professional investors supported an orderly book. Spinneys’ consumer staples profile, expansion plans, and cash-generation narrative resonated with income-focused investors.
• Dubai Taxi Company (DFM, Nov 2023): DTC’s government-related issuer narrative plus clear dividend policy drew vast demand; the global offering was ~130× oversubscribed, raising ~AED 1.2bn. The transaction set a benchmark for Dubai’s state-linked listings and highlighted the depth of regional liquidity for infrastructure-adjacent assets.
• ARENA by DFM (Private Market, 2024–25): For companies not yet IPO-ready, DFM launched ARENA, a private-market platform enabling Initial Private Offerings and secondary liquidity among eligible investors—useful for family businesses and growth issuers building a track record before a Main Market float. Recent private-market activity has broadened issuer types and created a feeder path into the public Market.

Takeaways. Recent DFM deals show
(i) book-building remains the dominant pricing method for sizeable offers;
(ii) a clear dividend/earnings story and government-related visibility help scale demand; and
(iii) Dubai’s Private Market (ARENA) offers a credible pre-IPO route for firms still maturing governance, audits, and free-float readiness.

Quick Comparisons for Key Choice

Dimension	Fixed-Price IPO	Book-Built IPO
How the price is set	Issuer/advisers pre-set a single price.	Investor bids within a disclosed range; final price set by demand.
Price discovery	Limited—based on valuation comps and pre-marketing.	Strong—order book reveals real demand/elasticity.
Allocation	Pro-rata at the fixed price; oversubscription leads to scale-backs.	Discretionary within disclosed policy; anchors/cornerstones common.
Timeline complexity	Simpler documents and marketing.	Additional steps: ITF, price range, book-build, pricing/allocations.
Suited for	Smaller or straightforward offers.	Larger, high-interest, or volatile-sector offers.

FAQ