VIA Optronics shares slide on NYSE debutwritten by Bella Palmer
Shares of the firm opened at £9.42 apiece compared with the IPO price of £11.77 per ADS
VIA Optronics AG's shares underwhelmed in their debut on the New York Stock Exchange and fell as much as 35% on Friday, after the Germany-based company priced its initial public offering at the lower end of its indicated range.
Earlier on Friday, VIA sold 6.25 million American Depository Shares to raise about £73.75 million ($94 million).
Shares of the firm, which makes interactive display systems for a number of sectors including automotive and industrials, opened at £9.42 ($12) apiece compared with the IPO price of £11.77 ($15) per ADS.
VIA's debut also came on a day when U.S. capital markets were set for their longest weekly losing streak in a year as fears about the coronavirus' impact on the economy weighed on investor sentiment.
According to experts tracking IPOs, investors punished the stock for being overvalued and raised concerns over the company's financials.
Investors are concerned about if this company will be able to make money, said Jay Ritter, an IPO expert and professor at the University of Florida. At the offer price, the valuation of over £235.39 million ($300 million) was too high.
For the six months ended June 30, the company posted revenue of £56.96 million ($72.6 million), down 8% from a year ago. Its net loss narrowed to £791,252 from £2.28 million a year earlier.
According to CEO Jurgen Eichner, the pandemic did not impact VIA's plans to go public, although it affected the company's performance in the first quarter.
In the second quarter, we were already back on track. This was the right point in time (for us to go public), because we cannot sustain the growth organically, Eichner said.
VIA's customers include car-makers like BMW AG, Ferrari NV and General Motors Co and tech companies like Lenovo Group Ltd and Dell Technologies Inc.
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