Tokyo Metro’s IPO could boost the Japanese market as Chinese listings dry up
In Japan’s biggest initial public offering in six years, Tokyo Metro raised 348.6 billion yen ($2.3 billion) after pricing its shares at 1,200 yen per share. shares, according to the company’s regulatory filing Tuesday.
Miho Uranaka | Reuters
Analysts say Tokyo Metro’s initial public offering could boost momentum in the Japanese market and attract more companies to the country as China continues to lose momentum.
In Japan’s biggest IPO in six years, Tokyo Metro raised 348.6 billion yen ($2.3 billion) after pricing its shares at 1,200 yen each, according to a company report. ty. submit the prescribed documents Tuesday.
Reuters has it reportedThe IPO was oversubscribed more than 15 times, citing two sources familiar with the matter. The shares are expected to be listed on the Tokyo Stock Exchange on October 23.
“Everyone knows it and it’s priced relatively cheaply,” Mio Kato, founder of LightStream Research, told CNBC.Asian street signs” on Tuesday. “I think it’s clear that neither the Tokyo government nor the Ministry of Finance wants the IPO to fail.”
“This is a pretty big IPO for the year and it’s just something that everyone, you know, the entire public will be focused on as we get closer to the election,” Kato added. “We think they’re offering very, very good value.”
A recent report published of Dealogic, a financial markets platform, shows that in September, Asia-Pacific equity market issuance was worth just $168 billion, 15% lower than in the first nine months 2023 and down 27% over the same period in 2022.
According to the report, the decline in total issuance in Asia-Pacific coincided with a slowdown in China. However, India and Japan made up for the lack of release in China.
Kato said he thinks this positive trend will continue in Japan, suggesting the country will soon bounce back after years of subdued IPO activity.
“I saw some news about NASDAQ actually trying to attract more Japanese IPOs. Because you know, China’s IPO market has been pretty quiet recently,” he said.
Hyundai India also started taking orders for its $3.3 billion IPO in Mumbai this week, in a deal set to become the country’s biggest listing.
Ringo Choi, EY’s Asia-Pacific IPO leader, told CNBC:Squawk Box Asia” on Tuesday that both Hyundai India and Tokyo Metro were in “very hot positions” and “highly liquid.”
Choi predicts that those two IPOs will be a highlight for their respective markets.
Asked if he thought the listing of Tokyo Metro and Hyundai India would open the door for more activity, he said: “I do.”
“I really think that after these two IPOs and if the return of IPOs [are] quite well, it will attract many companies to consider these two markets as IPO destinations,” Choi said.
– CNBC’s Dylan Butts contributed to this report.
