IPOs in Egypt: how new share offerings work, and what you really get

An IPO (initial public offering) is the first time a company sells its shares to the public and lists them on the Egyptian Exchange (EGX). In Egypt you subscribe through a licensed brokerage, usually pay part or all of the order upfront, and often get only a small slice of what you asked for.

The first trading day can swing either way. Over years, research finds IPOs as a group have often lagged the wider market.

What an IPO is and why companies list

Before an IPO, a company is owned by founders, private investors or the state. Listing can do two things:

• Raise new money for the company by issuing new shares (a capital increase). The cash goes to the business.
• Sell existing shares. The cash goes to the selling owners, not the company.

Each share you get is a small piece of the business, and you can sell it on the EGX after listing.

The state is listing companies too. On 26 July 2026, the FRA launched an IPO readiness programme targeting 30 state-owned listings. Twenty state firms were already temporarily listed while they prepare.

Public offering vs private placement

Egyptian IPOs are usually split into two tranches with different buyers.

The split varies. In one October 2026 offering, retail got 48 million of 320 million shares, or 15%.

How individuals subscribe in Egypt

These steps follow Egyptian press reports from October 2026. Terms differ by offering, so confirm each with your brokerage.

1. Get an investor code. You need a trading code for the EGX. If you don't have one, a licensed brokerage can issue it when you open an account with your national ID.
2. Sign with a brokerage. Al Ain News also lists accredited banks as a channel. The prospectus says which receiving banks or brokerages take orders.
3. Note the subscription period. In one October 2026 offering, orders opened on 7 October and the public tranche closed on 15 October.
4. Choose how many shares to request. In that offering, the minimum order was 100 shares.
5. Pay upfront. In that offering you paid 25% of the order value when you registered, and could request up to four times what you prepaid. Other offerings may ask for the full amount. Check before you order.
6. Wait for allocation. After the close, shares are shared out by the offering's rules. You pay for what you receive and get the unused money back.
7. Trading starts on a day the EGX announces.

Reading the prospectus

Every offering publishes a prospectus (or offering memorandum) under FRA oversight. It is long, but five parts matter most.

Valuation in practice. Say a made-up company offers shares at EGP 10 and earned EGP 0.80 per share last year. Its P/E ratio is 10 ÷ 0.80 = 12.5. Compare that with similar listed companies, not with the hype.

Lock-ups. Under the EGX rules summarised by Baker McKenzie (updated 1 February 2026), owners of 10% or more generally must keep 51% of their stake for at least 24 months, unless the FRA approves an exception. When a lock-up ends, more shares may come to market.

Oversubscription: why you get so little

Oversubscription means investors ask for more shares than are on offer. In one October 2026 offering, retail orders were about 13.5 times the tranche a day before it closed: about EGP 15.9 billion of orders for EGP 1.18 billion of shares.

Orders are then usually cut back in proportion (pro rata), so everyone gets the same fraction.

Worked example: 20 times oversubscribed

A made-up example. A company offers 2,000,000 retail shares at EGP 10. Retail investors request 40,000,000 shares.

Your EGP 9,500 sat idle during the subscription and allocation. Say it was tied up for 14 days and would otherwise earn 19% a year (an example rate). You gave up about 9,500 × 19% × 14 ÷ 365 = EGP 69.

Now the 25% route. You request 4,000 shares (EGP 40,000) and prepay EGP 10,000. At a 5% fill you receive 200 shares and pay EGP 2,000, so EGP 8,000 comes back. If the tranche were only half covered, you could get all 4,000 shares and owe another EGP 30,000.

First-day moves, and why they aren't a plan

New shares often jump on the first day, and sometimes fall. Jay Ritter's data covers 9,253 US IPOs from 1980 to 2024. The average first-day return was 18.9%, measured from the offer price.

Your 50 shares cost EGP 500. A 20% first-day rise makes them worth EGP 600, a EGP 100 gain before fees. That is 1% of the EGP 10,000 you tied up. A 15% fall would cost you EGP 75.

Selling straight away (flipping) is a bet on mood, which is speculation. At least one October 2026 offering had a 30-day price stabilisation mechanism, with terms that varied by tranche. It doesn't guarantee the price won't fall, Masrawy noted.

IPOs also move the wider market. In mid-October 2026, fund managers sold other shares to free cash for new offerings, draining liquidity. The EGX70 fell about 9% over three sessions.

What the long-run research says

Ritter's tables (updated 2026, US data, returns through December 2025) measure returns from the first-day close, not the offer price:

Of 9,195 IPOs from 1975 to 2021, 60% had a zero or negative return over three years from the first close. The median return was −25.7%, while a few big winners lifted the average.

This is US data; we found no comparable long-run study of EGX IPOs. Larger companies did roughly in line with similar listed firms, and group averages say nothing about one offering.

Your plan

1. Get your base right first. Keep your emergency fund in cash and pay off expensive debt before investing in shares.
2. Open a brokerage account early. Getting an investor code can take time, so don't wait for a hyped offering.
3. Read the prospectus. Note the use of proceeds, who is selling, the valuation (P/E against similar companies), the risks and the lock-ups.
4. Ask your brokerage for the terms. Minimum order, upfront payment, cancellation deadline, allocation rules and refund timing.
5. Request only what you could pay for in full. Assume you might get every share.
6. Decide your holding plan before trading starts. Write down why you'd keep or sell, based on the business, not the first-day price.
7. Keep it small. An IPO is still one company, so it should be a small part of your long-term money.

What to watch out for

• Hype and crowds. Big oversubscription numbers show demand, not value. Following the crowd is herd behaviour.
• Borrowing to subscribe. Using margin or loans to inflate an order magnifies losses. Falling prices can force margin sellers to sell, as analysts described in October 2026.
• Flipping. On a tiny allocation, a first-day gain is small, and it can turn into a loss.
• "Guaranteed allocation" offers. Allocation follows the offering's published rules. Anyone selling a guaranteed IPO allocation, or asking you to send money outside a licensed brokerage, is a red flag. The FRA publishes a list of licensed firms and a warning list of unlicensed pages (as of September 2025).

This guide is for education only. It is not advice to subscribe to, buy or sell any offering or share.