Aston Martin aims for £5bn IPO valuation
By Oliver Haill
Date: Thursday 20 Sep 2018
(Sharecast News) - Aston Martin has confirmed pricing for its London initial public offer that would give the luxury carmaker a valuation of up to £5.07bn and propel it into the upper echelons of the FTSE 250.
Aston Martin Lagunda, to give the company its full name, said its shares would be issued at 1,750-2,250p, with 56.78m shares offered, or 25% of the company's shares at the mid point of the price range. There could be an over-allotment option of up to 10% more shares.
The final price will be announced just ahead of the start of trading on 3 October.
Last week the James Bond carmaker confirmed that it would have a premium listing on LSE's main market, with current owners, Italy's Investindustrial, Kuwait's Adeem Investments and Primewagon all planning to sell down their stakes and Germany's Daimler retaining its full 4.9% stake.
Larger rival Ferrari listed on the stock market priced at $52 per share in ate 2015, before falling by more than a third in the first few months of trading but since rallying strongly to top $135.
Aston Martin's £20 mid-price of the offer meant retail investors would be able buy 7,500 shares for the price of a near £150,000 DB11 model, pointed out analyst Laith Khalaf at Hargreaves Lansdown, a broker where more than 40,000 investors have registered for updates on the IPO.
The £5bn valuation would put it fender to fender with the likes of Marks & Spencer, Severn Trent and Royal Mail, he said, assuming it ticks all the necessary boxes to make it into FTSE Russell's UK indices of course.
"Aston Martin has a chequered past, having gone bust seven times in its 105 year history, though recent performance seems to be turning a corner. The luxury car maker is looking to ramp up production, expanding into the SUV market and building its presence in China," Khalaf said.
With Aston Martin this month reaffirming targets to deliver 6,200-6,400 cars this year, 7,100-7,300 in 2019 and ramp up roughly 14,000 units annually in the medium term, Khalaf said the key to success will be increasing the number of models on the road while maintaining the exclusivity of the brand.
"It's important for potential investors to concentrate on the company's long term financial prospects and not to get carried away by the brand however. That means having a thorough read of all relevant information the company is producing as part of its float, and only investing if they are happy with all the risks involved."
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