Five IPOs raised $858 million this past week, led by fast-growing digital coupon platform Ibotta (IBTA) and utility infrastructure services carve-out Centuri Holdings (CTRI).
Both deals managed to price above the midpoint and notch double-digit returns, even as the broader IPO Index plunged 6.9% this week, alongside a 5.5% drop in the Nasdaq. Expect IPO investors to demand a healthy margin of safety when indicating on future offerings.
Digital rebate platform Ibotta upsized its offering and priced $4 above the range at $88 to raise $577 million at a $3.2 billion market cap. It opened on Thursday at $117 (+33%) but finished the week at $98 (+11%). The company's platform allows CPG brands to deliver digital promotions to consumers through a single network, and as of 12/31/23, it worked directly with over 850 different clients representing over 2,400 different brands. Ibotta delivered solid growth in 2023 (+52%) and turned profitable, though digital discounting is a competitive industry (Honey, Groupon, Microsoft, Rakuten, RetailMeNot, Quotient Technology).
Centuri Holdings, a carve-out of gas utility Southwest Gas (NYSE: SWX), priced at the high end of the range at $21 to raise $260 million, or $315 million including a concurrent private placement to Icahn Partners. The stock returned 10% on day one, and traded up another 3.5% on Friday, even as the broader market sold off. Centuri is a pure-play North American utility infrastructure services company, focused on the modernization and maintenance. The company has over 400 customers throughout North America, with a project backlog of more than $5 billion. It has some leverage post-IPO, and projects can be unpredictable, though increasing utility capex has fueled strong returns in the industry, which should be resilient in any economic environment.
Three micro-caps listed in the US as well, based in Singapore or Hong Kong. They had volatile early trading, with one (TRSG) popping about 50% on its first day and another (TWG) dropping about 50% on day one. In addition to the names listed below, China-based automotive mold supplier Mingteng International (MTEN) raised $5 million and IPO'd on the Nasdaq, however it failed to meet our $50 million IPO market cap cutoff.
| 5 IPOs During the Week of April 15th, 2024 | |||||
|---|---|---|---|---|---|
| Issuer Business | Deal Size | Market Cap at IPO | Price vs. Midpoint | First Day Return | Return at 04/19 |
| Tungray Technologies (TRSG) | $5M | $65M | -20% | +49% | +49% |
| Provides customized industrial manufacturing services in Singapore and China. | |||||
| Centuri (CTRI) | $260M | $1,824M | 8% | +10% | +14% |
| Carve-out of Southwest Gas providing infrastructure services to utilities. | |||||
| Ibotta (IBTA) | $577M | $3,181M | 10% | +17% | +11% |
| Provides a digital marketing platform that offers consumers cash rebates. | |||||
| Junee (JUNE) | $8M | $51M | -20% | +2% | +2% |
| Provides interior design and fit-out services in Hong Kong. | |||||
| Top Wealth Group (TWG) | $8M | $116M | -20% | -52% | -7% |
| Hong Kong-based supplier of luxury caviar products. | |||||
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Two sizable issuers submitted initial filings this week, both headquartered outside the US: online betting company Games Global (GGL) filed for an IPO we estimate could raise $200 million, while Israeli smart glass company Gauzy (GAUZ) filed to raise $75 million. They were joined by a larger SPAC and a micro-cap mining company.
| 4 Filings During the Week of April 15th, 2024 | |||
|---|---|---|---|
| Issuer Business | Deal Size | Sector | Lead Underwriter |
| GP-Act III Acquisition (GPATU) | $250M | SPAC | Cantor Fitz. |
| Blank check company backed by GP Investments, Boxcar Partners, and a former Hain Celestial exec. | |||
| Games Global (GGL) | $200M | Technology | JP Morgan |
| Global publisher of online betting and casino games. | |||
| Gauzy (GAUZ) | $75M | Industrials | Barclays |
| Israel-based manufacturer of smart glass films. | |||
| Nova Minerals (NVAM) | $17M | Materials | ThinkEquity |
| Australian gold exploration company with a property in Alaska. | |||
IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 4/18/2024, the Renaissance IPO Index was down -1.5% year-to-date, while the S&P 500 was up 4.1%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Kenvue (KVUE) and Nu Holdings (NU). The Renaissance International IPO Index was down 3.0% year-to-date, while the ACWX was up 1.0%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include Wise and Porsche.
