In the latest sign of frenzied trading in the IPO market, a new micro-cap issuer popped more than 350% on Tuesday.
EZGO Technologies (EZGO) raised $11 million by offering 2.8 million shares at a price of $4.00 in its Nasdaq listing, at a market cap of $42 million. The stock finished Tuesday at $18.11 for a return of 352.8%. The company manufactures, rents, and sells electric bicycles in China. EZGO generated net revenue of $7.4 million in the 12 months ended 9/30/20, with a gross margin of 20%, and a net loss of $0.1 million. Revenue grew 66% in the 9mo20. ViewTrade Securities was sole bookrunner on the deal.
Because the company priced at a market cap of less than $50 million, it was not tracked by Renaissance Capital and is excluded from our IPO stats. Based on our historical IPO stats, the last IPO to pop at least 350% was Baidu.com in 2005, which flew up 354% on its first day.
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Several recent small IPOs have experienced similar trading, notably Chinese food retailer Wunong Net Technology (WNW), which IPO'd in December at $5.00 per share, and peaked at $122.50 after its third day of trading; the stock closed Tuesday at $21.96.
