The 2020 IPO market is opening right on time, if recent history is a guide. Five deals are on the IPO Calendar for the week of Jan. 13, 2020, and four are from China; more on this in a minute.
Listed below are the pricing dates for the year’s first IPO, going back over the past five years:
- 2019 – Jan. 7
- 2018 – Jan. 9
- 2017 – Jan. 16
- 2016 – Feb. 2
- 2015 – Jan. 15
This week, four IPOs are scheduled to be priced on Thursday, Jan. 16, while the other is set for “the week of Jan. 13.”
Nevertheless, January 2020 looks to be ahead of the last 19 years.
The January IPO traffic from 2001 through 2019 shows an average of eight deals for the month. The busiest January was in 2018 with 18 deals and the slowest years were 2003, 2009 and 2016 with zero deals.
The current calendar lists five IPOs, but some of their prospectuses show an interesting new development. Not only are insiders issuing indications of interest (buy orders), but so are selected outside investors. If all these indications are filled, then the size of these deals could be drastically reduced in terms of the number of shares available for the investing public.
Let’s take a look at this week’s IPOs, organized by pricing and trading date.
Pricing During “The Week of Jan. 13th”
AnPac Bio-Medical Science (ANPC proposed), based in Lishui, China, is a biotech company focusing on early cancer screening and detection. The company sells a multi-cancer screening and detection test that uses its innovative patented CDA technology and its proprietary CDA device. AnPac Bio-Medical says its technology “requires only a standard blood sample from a tested individual,” minimizing the inconvenience and invasive procedures of other technologies, the prospectus says.
Note: An individual investor has indicated interest in buying up to US$1.75 million worth of the American Depositary Shares (ADSs) at the IPO price – or 8.1 percent of the $21.7 million IPO, according to the prospectus. This projection is assuming the IPO price is $13, the midpoint of the $12-to-$14 price range on 1.7 million ADSs.
Thursday night pricing for Friday trading:
I-MAB(IMAB proposed), based in Shanghai, is a clinical-stage biopharmaceutical company committed to the discovery, development and commercialization of novel or highly differentiated biologics to treat cancers, autoimmune disorders and other diseases with significant unmet medical needs. Its leading drug candidate is a treatment for multiple myeloma.
Note: Several investors have indicated an interest in buying up to $48 million of the ADSs at the IPO price – or 48 percent of the $100 million IPO – if it’s priced at $13.50, the midpoint of its range; these investors include one entity – an affiliate of a principal shareholder – that wants to buy $15 million of the ADSs, according to the prospectus.
LIZHI(LIZI proposed), based in Guangzhou, China, says it has transformed the audio industry by creating Lizhi, a mobile app for everyone to create, store, share, discover and enjoy audio (radio programs and podcasts) and interact through it. The company says it is the largest UGC online community in China as of Sept. 30, 2019, according to iResearch. (UGC stands for user-generated content.)
Note: An affiliate of Weibo, an affiliate of Xiaomi and two other investors have indicated an interest in buying up to $36 million of the ADSs at the IPO price – or 73.2 percent of the $49.2 million IPO – if it’s priced at $12, the midpoint of its range, according to the prospectus.
Phoenix Tree Holdings Ltd. (DNK proposed), based in Beijing, says it is redefining the residential rental market through technology. The company started Danke in 2015 to provide young people with comfortable yet affordable homes. The company had more than 400,000 apartments in 13 cities in China as of Sept. 30, 2019, making it “one of the largest co-living platforms in China with the fastest growth,” according to iResearch, the prospectus says.
Note: Insiders have indicated an interest in buying up to $55 million of the ADSs in the IPO at the IPO price – and a strategic investor has indicated an interest in buying up to $60 million of the ADSs in the IPO at the IPO price – for up to 70 percent of this $164.3 million IPO, if it’s priced at $15.50, the midpoint of its range, according to the prospectus.
Velocity Financial (VEL proposed), based in Westlake Village, California, is a vertically integrated real estate finance company founded in 2004. It originates and manages investor loans for small residential rental properties (1 to 4 units) and small commercial properties.
This is an IPO of 7.3 million shares at $14 to $16 each.
(For more information on these companies, please check the IPO Profiles on IPOScoop.com.)
Week of Jan. 20
At press time, no IPOs were scheduled for pricing this week. On Monday, Jan. 20, 2020, the U.S. stock market will be closed for the federal holiday for Dr. Martin Luther King’s birthday.
Next week’s marquee may be blank so far, but there’s plenty of activity backstage. The U.S. Securities and Exchange Commission’s filing window was busy last week as seven new prospectuses were filed and seven amendments were posted.
Disclosure: Neither the author nor anyone else on the IPOScoop.com staff has a position in any stocks mentioned, nor do we trade or invest in IPOs. The author and IPOScoop.com staff do not issue advice, recommendations or opinions.