The UAE’s initial public offering (IPO) pipeline is poised to diversify as Cafu, a Dubai-based fuel delivery start-up, considers selling a stake in the business. This potential sale comes amid strong investor demand for new listings, as reported by Bloomberg, which cited sources familiar with the matter.

Cafu is reportedly collaborating with Lazard, a financial advisory and asset management firm, to navigate the IPO process. However, discussions are still in the preliminary stages, and no final decisions have been made regarding the stake sale.

Since its launch in 2018 by entrepreneur Rashid Al Ghurair, Cafu has been providing fuel delivery services at the same prices as petrol stations, without added delivery fees. The company has also expanded its offerings to include at-home vehicle services such as battery and tyre changes, engine oil replacement, and emergency rescue services.

Initially, Cafu charged basic delivery fees until the onset of the Covid-19 pandemic, during which it waived these charges. Recently, however, the company announced the reintroduction of delivery fees through a client circular. They stated, “Keeping a service like this running, citywide 24/7, takes a lot behind the scenes. We’ve absorbed those costs for as long as we could. Now to continue delivering the experience you rely on, we are reintroducing a small delivery fee.”

The new fee structure includes a Dh20 charge for the priority slab, which ensures delivery within 20 minutes, and Dh16 for standard delivery, which can take between 30 minutes to two hours. For overnight orders placed between midnight and 6 a.m., a fee of Dh12 will apply.

Vijay Valecha, chief investment officer at Dubai investment company Century Financial, remarked on the potential for the IPO, stating, “The UAE’s mega IPO bull wave will likely see another addition to its kitty.” Valecha highlighted that Lazard’s successful entry into the region would be significant, given the competitive landscape dominated by firms like Rothschild.

Cafu is recognized as the leading fuel delivery operator in the region, although globally, the market features several dominant players. Market reports indicate that North America holds the largest share of the on-demand fuel delivery market, with several apps such as Yoshi and Gaston gaining traction alongside major oil companies like Shell and Mobil.

According to Business Research Insights, the global on-demand fuel delivery market is expected to reach $2.37 billion by 2033, growing at a compound annual growth rate of 15.97 percent from 2025 to 2033.

The UAE has experienced a surge in IPO activity recently, driven by efforts to diversify its economy. Last year, there were seven IPOs in the UAE, which included major companies such as Talabat Holding and Lulu Group. These IPOs accounted for 47 percent, or $6.2 billion, of the total Gulf proceeds for the year, as reported by PwC.

The year 2024 marked a record high for Gulf IPO volumes, with 53 listings and a total of $13.2 billion raised. In 2021, the Dubai Financial Market launched an incentives program to promote new IPOs from private sector companies, providing financial support and waiving listing fees for three years to stimulate market growth. The same year, Dubai also announced plans to list ten government and state-owned companies to further enhance the financial market’s size to Dh3 trillion.