The IPO Buzz: Nano Labs Ltd. Prices its IPO Near the High End at $11.50

Nano Labs Ltd. (NA), the parent of a crypto-focused Chinese fabless chip maker, priced its IPO at $11.50 – near the top of its $11.35-to-$11.51 range – on 1.77 million American Depositary Shares (ADS) on Monday night, July 11, 2022. The IPO raised $20.36 million – about $130,000 more than if it had been priced at the $11.43 mid-point of its range. The stock opened at $7.61 – down 33.8 percent from its IPO price – marking it as a broken deal. Nano’s ADS later recovered some of that loss to trade at around $10.60 at around 12:50 p.m. EDT. At the close, Nano’s stock was at $12.05, up 55 cents, for a 4.78 percent gain from its IPO price. (Editor’s Note: This column, published Tuesday morning, July 12, was updated Wednesday morning, July 13, and again on Thursday, July 14, with more IPO pricing news.)

The pricing bucked the head winds of falling cryptocurrency prices amid trouble in the crypto sector.

AMTD Global Markets, Maxim Group and Tiger Brokers were the joint book-runners.

Nano Labs’ parent, incorporated in the Cayman Islands, issued the ADS sold in the IPO. The company’s operating business in China makes fabless chips, primarily used in cryptocurrency mining, the prospectus says.

In contrast, another small-cap IPO on Monday night’s pricing roster – Warrantee Inc. (WRNT proposed) – was postponed on Monday afternoon. The IPO was 2.14 million shares at $6 to $8 to raise $15 million. Network 1 Financial Securities was the sole book-runner.

Warrantee, based in Osaka, Japan, is an insurance services provider and marketing company.

Some on the Street say that this deal may be brought back at a later time.

Japan was in mourning on Monday for Shinzo Abe, its former long-time prime minister, who was assassinated on Friday (July 8).

Two Deals Priced Tuesday Night

Intelligent Living Application Group (ILAG proposed), the IPO of a Hong Kong-based lock maker, and Netcapital Inc. (NCPL/NCPLW), the unit offering and NASDAQ uplisting of a Boston-based crowdfunding platform for private companies, were priced Tuesday night, July 12, 2022, to trade Wednesday, July 13, on the NASDAQ.

These deals headed into rough waters on Wednesday for U.S. stocks, which plummeted after data showed that the U.S. Consumer Price Index (CPI) rose 9.1 percent in June – the highest since December 1981. Gasoline prices led the spike in the CPI, The Wall Street Journal reported.

Network 1 Financial Securities was the sole book-runner of Intelligent Living Application Group’s IPO; the deal was priced at $4.00 – $1 below the assumed IPO price of $5.00 – and 5.06 million shares were sold to raise $20.2 million.

Intelligent Living Application Group’s stock jumped to $22.01 at its opening trade, up more than 400 percent from its IPO price. It was up 403.5 percent at $20.14 at about 11:30 a.m. EDT on volume of about 2.28 million shares. The stock climbed to an intraday high of $26.40 and then eased back down to close at $6.12. For the day, the stock was up 53 percent from its IPO price. Trading volume was about 7.13 million shares, according to the NASDAQ.

ThinkEquity was the sole book-runner of Netcapital’s public offering. The offering was priced at $4.15 – well below the stock’s last closing price of $8.25 on the OTC market – and 1.2 million units (stock and warrants) were sold to raise $5 million. At pricing, Netcapital sold about 800,000 more shares of common stock and warrants than the amount (1.4 million) listed in the prospectus.

Netcapital’s stock slid at the opening to $3.00 – down $1.15 from its IPO price – and then fell to $2.37 at around 11:35 a.m. EDT, on its first day of trading on the NASDAQ. Netcapital’s stock closed at $2.61, down 37 percent from its IPO price. 

Rounding Out the Week

Treasure Global (TGL proposed), a New York-based company that owns Malaysian payments app ZCITY, was set to price its IPO on Wednesday night, July 13, to trade Thursday, July 14, on the NASDAQ. But no pricing information was available on Thursday morning. The IPO is small: 3.0 million shares at $4.00 to $6.00. EF Hutton is the sole book-runner.

The IPO of Virax Biolabs (VRAX proposed) has been rescheduled for pricing next week, according to Boustead Securities, the sole book-runner.

Two more IPOs – AMTD Digital Inc. (HKD proposed) and Onfolio Holdings (ONFO proposed) – are also on the pricing roster for Thursday night, July 14. Please see our IPO Calendar for details.

Out of the SPAC Pool

Bill Ackman made a splash on Monday afternoon (July 11). His Pershing Square Tontine Holdings (PSTH) will liquidate its trust and return $4 billion to investors. The announcement generated headlines, but no surprises, given the dark side of the SPAC boom of 2020-2021.

Stay tuned.

(For more information, please see our IPO Calendar – Click on the company’s name and the hyperlink will take you to the IPO Profile, which includes a link to the prospectus.)

(Never trade on proposed symbols. You might wind up owning something on the OTC Bulletin Board.)

Disclosure: Nobody on the staff has a position in any stocks mentioned above, nor do they trade or invest in IPOs. The staff does not issue advice, recommendations or opinions.

Disclaimer: A SCOOP Rating (Wall Street Consensus of Opening-day Premiums), is a general consensus taken, at press time, from Wall Street and investment professionals concerning how well an IPO might perform when it starts trading. The SCOOP Rating does not reflect the opinions of anyone associated with The SCOOP ratings should not be taken as investment advice. The rating merely reflects the opinion of the professionals at the time of publication and is subject to last-minute change.