Abu Dhabi’s IHC plans stock buyback following price adjustment

Abu Dhabi-based conglomerate, International Holding Company (IHC), is contemplating a share buyback program to address a recent decline in its stock price after a significant increase. The CEO, Syed Basar Shueb, emphasized his confidence in the company’s future growth in a recent interview. The buyback program, valued at Dh5 billion dirhams (US.4 billion), aims to boost the share price by enhancing the company’s earnings per share and offering an exit opportunity for shareholders who may have missed out on the previous stock price surge.

The announcement of the share buyback program comes after a period of stagnant stock price performance for almost two years. Despite this recent stability, IHC’s share price remains significantly higher compared to many global firms, with a price-to-book ratio of 7, exceeding Berkshire Hathaway’s ratio of 1.57. Shueb discussed IHC’s diversification strategy, highlighting investments in various sectors such as Elon Musk’s SpaceX and Zambia’s Mopani copper mine. Additionally, plans for a potential listing of Daman Insurance, a subsidiary of IHC’s healthcare holding PureHealth Holding PJSC, were disclosed.

Following a remarkable 43,000% increase in IHC’s stock price, a correction period was inevitable. The company’s leadership believes that the share buyback program will not only stabilize the stock price but also showcase confidence in IHC’s long-term potential. The success of the program will depend on effectively balancing the needs to reward existing shareholders and maintain the company’s financial health.