The shares surged 158 percent to close at 1,550 yen while the Topix index added 0.9 percent. The Tokyo-based company raised 5.13 billion yen ($50.5 million) selling stock at 600 yen apiece in the IPO, according to data compiled by Bloomberg.
Japanese IPOs have typically gained on their market debut this year, with only two of the 44 offers that have priced so far in 2013 declining when they first traded, according to data compiled by Bloomberg. ZIGExN operates 13 main websites, gathering information on everything from jobs and apartments to cars, and the Tokyo-based company aims to expand overseas in Asia and Africa after opening an office in Vietnam in January.
“The strength of ZIGExN is the convenience for users,” said Toshiaki Iwasaki, an analyst at Mito Securities Co. Ltd. “It attracts users with clear goals for what information they want and they can check the information all at one stop.”
At the IPO price, the company was valued at about 60 times earnings, Chief Executive Officer Joe Hirao said in an interview today.
“Our stock price is valued by investors,” Hirao said. “We are generating operating profit margin of more than 50 percent.”
Of the 44 priced IPOs in Japan this year, 19 gained 150 percent or more by the end of the first day of trading after including ZIGExN today. ReproCELL Inc. (4978), a stem cell business, surged the most, gaining 472 percent when it debuted in June.
About 80 companies will go public in Japan next year, with even more slated for 2015, according to Keiji Kuramoto, an executive director at Nomura’s IPO department.
“There are needs for job-search websites. The company is operating various websites, so I think the key is how much ZIGExN can add value,” Mitsushige Akino, chief fund manager at Ichiyoshi Asset Management Co. in Tokyo, said by phone. “The current stock price may be too high, which is common for stocks that have listed recently.”
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