Tokyo Metro shares rose by almost half at the time of their market debut

TOKYO (Reuters) – Shares of Tokyo Metro rose 45% in their market debut on Wednesday, after Japan’s biggest initial public offering in six years raised $2.3 billion.

Tokyo Metro, one of the capital’s two main subway operators, was trading at 1,730 yen ($11.41) in the morning after opening the trading session on a low note with a lot of buying orders.

The company raised 348.6 billion yen after pricing its initial public offering at the high end of its indicative range of 1,200 yen apiece. The public offering was oversubscribed more than 15 times, and investors were attracted by a well-known brand offering an attractive dividend rate.

“The listing of a large company known to individual investors has a huge merit in expanding the investor base,” said Toshio Morita, CEO of the Japan Securities Dealers Association and former president of Nomura Securities, before the debut.

Tokyo Metro forecast a dividend of 40 yen per share for the fiscal year ending March 2025 and appealed to investors for additional benefits such as perks at the noodle restaurants it runs.

The company’s history dates back to 1920 with the establishment of the Tokyo Underground Company. Seven years later, Japan’s first subway line opened, connecting the Asakusa and Ueno districts of Tokyo.

It serves 195 kilometers (120 mi) of lines carrying 6.5 million passengers daily.

Its public offering is the largest in Japan since SoftBank Group listed the telecommunications company in late 2018.

Rigaku Holdings, a maker of X-ray examination tools, raised $863 million in an initial public offering at a stock valuation at an all-time high and will debut on Friday.

Japan has seen IPOs worth $4.9 billion since the beginning of the year, the largest amount in six years, according to LSEG data.

The benchmark index remained flat. It has gained 15% since the beginning of the year.

($1 = 151.6400 yen)

(Reporting by Sam Nussey and Miho Uranaka; Editing by Christopher Cushing)