Oatly, Procore Launches Quiet U.S. IPO

(Reuters) – The strong debut on the stock exchange of oat milk maker Oatly Group AB and construction software company Procore Technologies allayed investor fears on Thursday that IPOs in the United States could suffer from an episode of volatility.

At least three IPOs, including those of mortgage insurer Enact Holdings Inc and hearing care company Hear.com, were canceled last week, with the companies citing volatile market conditions for their decision.

A sudden drop in the stock market, prompted by concerns about inflation, pushed investors into safe-haven stocks and prompted them to shed risky stocks. As those fears have eased this week, the volatility that has hampered IPOs has subsided.

Shares of Swedish firm Oatly, which counts celebrities like Oprah Winfrey and Natalie Portman among its investors, closed up 19% on its first day of trading on Thursday, while Procore Technologies was up 30%.

“We had a hot market where everything was done. I don’t see any windows closing at all. Healthcare and technology remain the open area, ”said Mitch Nussbaum, chairman of the financial and corporate markets department at Loeb & Loeb.

The US IPO market has seen an unprecedented tear in the past 18 months, mainly due to investor appetite for tech stocks. Several high-profile tech companies, including Airbnb, Doordash, Snowflake, Roblox, Coinbase and Palantir Technologies, took advantage of the hype to go public.

Other big startups, such as online brokerage Robinhood Markets, the Instacart grocery app and electric vehicle maker Rivian are preparing to go public later this year.

The IPO market raised a record $ 167 billion from new issues in 2020, according to data from Dealogic. That record should be comfortably eclipsed this year, as deals have already raised more than $ 150 billion, mostly thanks to floats from Special Purpose Acquisition Companies (SPACs).

More companies are now turning to IPOs as investors worry about a bubble in the PSPC market.