Porsche’s IPO is set for Thursday. Here’s what you need to know.

German stock markets will get a momentary respite from the constant focus on gas supplies when sports car maker Porsche goes public on Thursday.

The IPO could be the second largest in German history and the third largest in Europe.

Porsche is spinning off the Volkswagen VOW3;
It is itself majority owned by Porsche Automobile Holding PAH3;
+ 0.41%,
The founding investment car of the Porsche and Piesch family. In its most famous product, Porsche paid out 911 million shares.

Here’s what the ownership structure will look like after the Porsche IPO.

Cowen and Company

That holding company, also called Porsche SE, will buy 25% and one share of Porsche AG, at any IPO price, and another 7.5%. Another 25% of Porsche AG is marketed by VW, but does not carry voting rights, symbol P911.

VW indicated a price range of €76.50 to €82.50 per preference share, to raise between €8.7 billion and €9.4 billion. For Porsche SE sales will add another €9.4 billion to €10.1 billion.

VW plans to distribute 49 percent of earnings through a special dividend. The rest will help VW’s push into electric vehicles, as well as software development.

The Qatar Investment Authority, Norway’s sovereign-wealth fund and T. Rowe Price Group Inc. TROW,
They are among the investors who have pledged to Porsche’s IPO.

More SUV maker

Porsche had 4 billion euros in revenue of 33.14 billion euros last year. Return on sales, operating profit excluding the 2019 diesel penalty reached 16 percent, and the margin before interest, taxes, depreciation and amortization (EBITDA) reached 24.5 percent. Ferrari Racing,

Last year it showed a difference of 35.7%.

“The key question for potential shareholders in Porsche is whether the company can make a successful transition to fully EV while maintaining or expanding margins. When you compare Porsche to Ferrari, it’s clear that there is room for improvement and improvement if Porsche can improve its operations and expand its already strong brand,” Saxo said. The bank’s head of equity strategy, Peter Ganry, said.

Although it’s better known as a sports utility vehicle, more than half of its vehicle sales over the past three years have come under the sport utility vehicle segment, the Cayenne and Macan families. In the year By 2024, it plans to offer a battery electric vehicle version of the Macan, as 50% of vehicle deliveries by 2025, and 80% by 2030, will be BEVs.

Porsche is based on the wealth of the world’s richest. “Particularly in an economic downturn, demand for the group’s products may decline as customers shift from buying luxury sports vehicles to vehicles in cheaper segments,” the IPO said.

The entry-level model of the 911 sports car will cost €113,500 in Germany, according to the IPO prospectus. The cheapest Porsche – the 718 – costs a cool €59,200.

Dependence on natural gas

Porsche says it is not immune to the struggles of third-party suppliers. And she is vulnerable to her home country’s energy woes, both in favor of natural gas and renewables such as biogas. Most of the vehicles are made in Germany and Slovakia.

The war between Russia and Ukraine has made shipping to its biggest market, China, too expensive. Porsche stopped exporting to Russia, and the war cost raw materials, as well as the costs of products made in Ukraine, such as wire and steel.

Joint Global Coordinators and Book Controllers are Bank of America BAC;
CT Group C,
Goldman Sachs GS.
and JP Morgan JPM
Other banks are also participating in the IPO.

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