Solar power equipment maker Nextracker Inc. rose 27% in its trading debut after raising $638 million in the biggest US initial public offering of the year.
(Bloomberg) — Solar power equipment maker Nextracker Inc. rose 27% in its trading debut after raising $638 million in the biggest US initial public offering of the year.
The share sale, ending a four-month chill for US listings, comes as the pipeline of pending IPOs continues to fill. It also shows that companies falling under the heading of ESG —environmental, social and governance — can command investor attention.
“There’s a huge appetite from equity investors for ESG businesses, renewable energies like this is right in their wheelhouse,” Paul Lundstrom, chief financial officer of Nextracker’s parent company, said in an interview. “That sector is hot and everybody wants to own a piece of what is ultimately going to be the future in energy.”
Nextracker exceeded its own fundraising goals for the IPO. It sold 26.6 million shares for $24 apiece after earlier marketing about 23 million shares for $20 to $23. The shares, which opened trading at $30.31, closed at $30.46 Thursday in New York trading, giving the company a market value of about $4.5 billion.
It’s the biggest IPO on as US exchange since October, when self-driving technology company Mobileye Global Inc. raised $990 million including so-called greenshoe shares.
Hesai Climbs
Nextracker’s debut also came on the same day that of Hesai Group, a driverless technology company. Shanghai-based Hesai also priced its share above its targeted range, raising $190 million, and rose 11% in its Nasdaq debut.
More significantly, Hesai is the biggest listing in the US by a China-based firm since Didi Global Inc.’s $4.4 billion IPO in 2021. It comes as Chinese firms are returning to US equity markets, signaling reduced concerns over the political and financial risks that led to Didi’s delisting.
Two other companies on Thursday are set to raise more than $100 million each in New York listings. Enlight Renewable Energy Ltd. is looking for as much as $293 million, while Mineralys Therapeutics Inc. is seeking up to $160 million, according to data compiled by Bloomberg.
IPO Pipeline
Other pending listings include Johnson & Johnson’s consumer health business Kenvue Inc., which filed last month for an IPO, and Vietnam based electric-vehicle maker VinFast Auto Ltd., which submitted its filing in December.
Nextracker, based in Fremont, California, designs and develops integrated solar tracker and software solutions used in utility-scale and ground-mounted distributed generation solar projects. The company had revenue has grown for three consecutive years to $1.5 billion, with net income of $51 million in its most recent fiscal year.
Nextracker’s parent company Flex Ltd. will continue to control the company, according to its filings with the US Securities and Exchange Commission. Investment management firm TPG is among Nextracker’s backers.
The offering was led by JPMorgan Chase & Co., Bank of America Corp., Citigroup Inc. and Barclays Plc. The shares are trading on the Nasdaq Global Select Market under the symbol NXT.
–With assistance from Pei Li, Yiqin Shen and Crystal Tse.
(Updates with closing share price in fourth paragraph.)
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