GHappy to see who had a chance in the allotment of new shares to the Polish stock exchange debutante Allegro. The share of the online trading company started trading on Monday with a price increase of more than 50 percent compared to the issue price on the Warsaw Stock Exchange. The first note was 65 zlotys. That is the equivalent of 14.30 euros after the owners had spent them at 43 zloty (9.46 euros). The course continued to pick up later.
An Ebay copy
The online retailer founded in 1999 in Posen (Poznan) as a competitor to Ebay, of which one fifth of the shares are now in free float, is valued at the equivalent of 16 billion euros. According to calculations by the Reuters agency, Allegro is suddenly the most valuable company on the Warsaw Stock Exchange because it has overtaken CD Projekt, the leading computer game manufacturer to date.
Allegro is the best-known e-commerce brand in Poland, the company is also active in neighboring countries in Eastern Europe. The website with more than 750,000 products attracts 20 million visitors a month. Like other online retailers, Allegro benefited from the corona pandemic because the mail order business was able to increase its sales.
The great demand for the company’s papers had already become apparent. With 231.5 million shares, the owners had submitted more papers than initially planned. The private equity funds Cinven, Permira and Mid Europa Partners in particular were able to reap significant profits. The consortium bought Allegro four years ago for the equivalent of three billion euros from the South African media group Naspers.
Allegro CEO Francois Nuyts said in Warsaw that the focus will now be on “the next phase of growth”, improving the electronic platform “and making it an even better place for consumers and retailers”.
Second largest IPO of all time
The IPO is one of the largest this year in Europe and the second largest in Warsaw. At the largest stock exchange in Eastern Europe, it is hoped that Allegro’s successful debut will mark a turning point. In the end, the trading center – like others – had difficulties in attracting new aspirants to take to the floor.
Domestic disputes in the governing coalition had recently burdened the market. But these should now have been overcome, said Henning Esskuchen, Head of Equity Research at Erste Group Bank AG. Provided that new corona infections that are not galloping call everything into question, he also expects a recovery in Poland that will tend to be faster than initially forecast. In view of the profit expectations of an average of 16 percent, the current ratings are “quite cheap”. He sees Poland as a favorite among the markets in the region. In addition, the Warsaw Stock Exchange offers the widest selection of sectors. Erste Group favors the construction sector, which has suffered little from the lockdown, but achieves better margins. Technology stocks are also interesting, especially from the fields of “gaming” and biotech, where some newcomers offer interesting options.