Lessons learned from the much anticipated IPO of British online supermarket Ocado: If you impose exceedingly optimistic expectations on the market these days, you will still have an excellent chance to hit an above average valuation. With the side-effect however, that the share price will then tank (“Ocado slumps on stock market debut”):
"Shares in the loss-making retailer closed last night at 167p, down from a listing price on the so-called "grey market" of 180p. Shares had traded as low as 155p.On Tuesday afternoon Ocado, which sell Waitrose groceries over the internet, was forced to cut its IPO price by 20pc: to 180-200p from a previous range of 200-275p.
The fall gave Ocado the dubious accolade of having the poorest first day's performance of any London IPO since shares in Brookwell fell by 8pc in June 2008, according to Bloomberg data.Tim Steiner, Ocado's chief executive, said that people are "missing things" about Ocado as they are "looking into the rear view mirror and looking at our historical performance – past cash flows, not future cash flows". "
At Wednesday’s IPO, Ocado valued at 937 million pounds. The original plan was 1.2 billion. Through the IPO, Ocado raised 200 million pounds of fresh capital which can be now used for further investments.
Ocado generated revenues of 427 million pounds in 2009.
Further details on the topic to be found at Google News.
Related posts:
- Supermarkets: Is Ocado Worth More Than 1 Billion British Pounds?
- Soap.com and the Online Supermarkets of the Future
- Ocado: How Big Is The Online Grocery Market Really?
Originally posted in German by Jochen Krisch, adapted for excitingcommerce.com by Jason Soo.
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