RIYADH, Oct 7: Saudi property developer Emaar Economic City’s stock debuted on Saturday at four times the price of its initial public offering which drew bids from a record 10 million investors.

Emaar Economic City is developing a $26.7 billion industrial and financial centre on the Red Sea coast which is the single largest private investment ever made in the world’s top oil exporter.

The $680 million IPO, the kingdom’s largest this year, was closely watched around the Gulf as the first major test of investor appetite after a crash halved the value of the Saudi stock market between February and May.

The stock opened at 40 riyals jumped as much as 12.5 per cent before yielding all those gains and closing the morning session at 30.50 riyals.

“A lot of small investors will hurry to take profits in the next three to five days,” said Ibrahim Al Alwan, head of research, Bakheet Financial Advisors.

The attraction of most IPOs for Saudi retail investors lies in the virtual certainty of a quick profit when the shares debut, because in the Gulf the offer price is determined by regulation rather than a process of book-building.

Gulf Arab IPOs were on average oversubscribed by more than 70 times during the equity boom of 2004 and 2005, according investment bank Gulf Capital. On average the shares rose 300 per cent on their debut.

When Emaar Economic City offered a 30 per cent stake, or 255 million existing shares, at a nominal value of 10 riyals each a record 10 million Saudis -- more than half of all citizens -- applied to buy shares. The IPO was 182 per cent oversubscribed in August.—Reuters