Porsche has overtaken its parent company, Volkswagen, to become Europe’s most valuable carmaker by market cap over the past week as Porsche’s stock hit the trading floor running shortly after its debut.
Porsche’s initial public offering (IPO) took place at the end of September on the Frankfurt Stock Exchange at a price of 82.50 euros, which dropped briefly before rallying to 93 euros to close out the week.
The end result was a whopping market valuation of 85 billion euros for Porsche, making it the most valuable carmaker in Europe ahead of rivals like Volkswagen, BMW, Mercedes-Benz, Stellantis and Ferrari.
The price dropped shortly after to 91 euros per share, which still put Porsche ahead of its rivals by a considerable margin with a market cap of 84 billion euros, compared with VW’s 77.7-billion-euro figure, Mercedes-Benz at 57.2 billion, BMW at 47.5 billion and Stellantis at 39.7 billion.
Porsche’s share price gained a significant bump from investment banks around the globe, to the tune of 3.8 million shares, or around 312 million euros as part of the ‘greenshoe’ option designed as a support mechanism for the IPO.
A spokesperson from Volkswagen is quoted in a Reuters report, saying: “Inflation data from Europe and the United States, recent worries over energy supply in Europe and the escalation of the war in Ukraine last Thursday led to fluctuations which made small-scale stabilisation measures necessary.”
Some market experts labelled the IPO as a “bold move” that came amid a time of rising inflation, the European energy crisis and increasingly tight interest rates that might have otherwise scared off investors.
Bloomberg reports that “for Volkswagen, the share sale is raising funds to plough into its electrification push, while investors get a slice of an emotional brand akin to Ferrari, which also managed a successful separation from parent, Fiat, in 2015”.
