IPO & RTO Tracker, 2017: End of Year Performance

New Listings

The year concluded with a busy month for new ASX listings. Several companies had their eyes on a public debut before Christmas, with 17 businesses listing in the first 22 days of the month. These listings were joined by one additional company after the Christmas weekend, making for a total of 18 new floats throughout December.

Of this total, 15 floats were conducted via IPO, and 3 were via RTO. Featuring most prominently among the new floats were debutants from the resources sector (5) and the industrials sector (5).

Turning to the performance of the respective listings, and the opening day average across all debutants was a gain of 18.4%. This was headlined by strong showings from Roots Sustainable Agricultural Technologies (ROO: +67.5%), and Rhythm Biosciences (RHY: +62.5%). Only 2 companies suffered losses on debut, with both stocks contained to a drop no greater than 5%.

ROO maintained its leading position into the end of the month, closing 80% higher than its float price on the last trading day for December. Other new listings which captured the attention of investors across the month included Janison Education Group (JAN: +43.3%); Jadar Lithium (SXI: +40%); and Wagners Holding Company (WGN: +39.5%). Symbol Mining (SL1) was the worst performing debutant for December, ending 17.5% below its RTO price.

Major Movers from 2017

With a total of 145 new floats throughout 2017, including 29 RTOs, the year produced numerous success stories for investors. In fact, there were 9 companies which posted returns of over 500% following their IPO or RTO. Extending the criteria further, and a total of 27 businesses delivered shareholders gains of at least 100%.

Across all the debutants, 91 stocks finished the year with a share price greater than (or equal to) the price at which the company raised funds. This means 54 businesses saw a depreciation in their share price. Consequently, the average performance across all new floats was skewed significantly to the positive side, resulting in average gain of 71.8%.

While investors would be happy with any of the top 40 performing debutants – all provided gains of at least 60% – we will focus on the top 3 performers for the year, each of which increased by over 800%.

Edging out all the other floats for 2017 was Ardea Resources (ASX: ARL), which rose from an IPO price of 20c to a final trading price of $1.90 – a gain of 850%. This meteoric rise eventuated despite the stock closing 10% down on its first day of trading back in February. Below are some of Ardea’s key announcements, which acted as a catalyst for the share price:

• The commencement of a pre-feasibility study at the KNP Cobalt Zone;
• A substantial resource upgrade at the KNP Cobalt Zone;
• A $5m deal with Australian Jade Mining Limited to commence chrysoprase mining; and
• Extensive findings of scandium at the KNP Cobalt Zone

Sliding into second place was Wattle Health Australia (ASX: WHA). The infant formula business brushed off a flat return on its first day to climb 815%, ending the year at $1.83. Although the company struck numerous deals with suppliers, distributors and retailers throughout 2017, and completed a key placement in late July, a large portion of the company’s gains were realized in October despite the absence of any price sensitive news. A retrace from highs of $2.78 in mid-November saw the stock lose about 35% of its value, which ultimately meant it lost the top spot among all the year’s IPOs.

The third stock we’ll profile was only a fraction behind its peers. Cann Group (ASX: CAN) notched up gains of 813.3% throughout 2017. Unlike the abovementioned floats, CAN raised funds at the higher price of 30c per share, but that didn’t stop the stock from climbing to $2.74. At one stage CAN reached a high of $3.75 – 1150%. Highlights for CAN included:

• A technical services agreement with Canada’s second largest publicly listed medicinal cannabis producer;
• Completion of the company’s first harvest production;
• Approval to make capacity variances to existing cannabis licences;
• Grant of an import/export licence for cannabis; and
• Successful completion of an upsized $60m placement

Focusing on the year’s worst performing floats, and a total of 9 companies posted share price losses of at least 50%. Each of the companies found themselves at the bottom end of the scale after failing to draw support from investors for a variety of reasons.

Although each of the underperformers were disappointing, it was ServTech Global Holdings (ASX: SVT) which featured distant last – recording a share price drop of 89.5% from its IPO price. The news should come as little surprise to regular followers of our monthly summaries, with the company among the worst performers during 3 separate months in 2017, and still in voluntary suspension after nearly a month.

Stay tuned for next month’s report. In the meantime, to stay informed on all the latest IPO news, follow us on Twitter.

YTD Performance Table

(Note: up to C.O.B Dec 29 – excludes recaps, partial acquisitions, foreign exempt listings)

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The team at

IPO Society
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