After the slowest year for IPOs in over a decade, the pipeline has seen a pickup in activity as new issuers anticipate improving market conditions. Eighteen IPOs have submitted initial filings this month, including eight that have filed to raise $100 million more, the most since last January.
A few positive signs have encouraged new issuers to prepare offerings. There have been two sizable listings this year (SKWD, TXO), both of which have traded up from their offer price. Valuations have fallen back to reasonable levels, driving M&A activity among recent IPOs, and the Renaissance IPO Index (tracker for the IPO ETF) has gained 16% since the start of the year.
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J&J's consumer unit Kenvue (KVUE) has led the charge, filing for an IPO that we estimate could raise up to $5 billion. Kenvue is the world's largest pure-play consumer health company by revenue with a portfolio of brands such as Tylenol, Band-Aid, Listerine, and Neutrogena. Mature and profitable, this dividend-paying company holds five #1 brand positions across major categories globally.
Solar tracker system provider Nextracker (NXT) is the second largest addition, filing for an estimated $500 million IPO. The company is profitable and growing, and as of 9/30/22, it had shipped approximately 70 GW of its solar tracker systems for use in utility-scale and ground-mounted solar projects on six continents. Nextracker is a close competitor of 2020 IPO Array Technologies, which has delivered strong trading YTD.
The month's other large filers include frac sand provider Atlas Energy Solutions (AESI), Israeli renewables company Enlight Renewable Energy (ENLT), Chinese lidar developer Hesai Group (HSAI) and Chinese veterinary clinic New Ruipeng Pet Group (RPET), and biotechs Mineralys Therapeutics (MLYS) and Structure Therapeutics (GPCR). We note that Structure Therapeutics launched on Monday and plans to raise $125 million at a $511 million market cap later this week.
