The IPO Market Winners & Losers Last Week - May 12, 2024.

Is this the start of a new cycle for Chinese IPOs?

The IPO market bagged three $100+ million deals this week, led by the largest US listing out of China in three years.

EV maker?ZEEKR (NYSE: ZK)?upsized and priced at the high end to raise $441 million at a $5+ billion market cap. The deal was pre-sold to Geely, its former parent, and new investors according to original terms. The EV space has been volatile, but with multiple close peers ZEEKR was able to pick the right valuation and the stock rose 35%.

Tech firm?Silvaco Group (Nasdaq: SVCO)?priced at the high end and posted a modest 4% gain on day one. Silvaco ticks some classic VC boxes – based in Silicon Valley, focused on semiconductor design – but it was bootstrapped. The reality is that?smaller VC-backed tech deals don’t really exist anymore. Chalk it up to evolving strategy in the wake of the past decade’s unicorn explosion.

The week’s other sizable deal, auto transportation roll-up?Proficient Auto Logistics (Nasdaq: PAL)?priced at the midpoint and traded off slightly. Lack of operating history and ample integration risk complicated the story. But the company has room to grow, if they can execute the combination as planned.

It was a mixed week for markets, as weak jobs numbers contended with disappointing earnings. The IPO Index finished off -0.8%, compared to +1.9% for the S&P 500. Drive-thru coffee chain?Dutch Bros?jumped +32.0% following an earnings beat. Ad analytics platform?DoubleVerify?plummeted -37.8% after lowering full-year revenue guidance.

Take care,

Bill Smith

CEO and Founder

Renaissance Capital

Visit us at www.RenaissanceCapital.com