Vindicated by 19% Jump on Debut: A Taiwan Firm Lists in Japan

(Bloomberg) -- Taiwan-based Appier Group Inc., which offers artificial intelligence-based software, rose above its listing price in its trading debut on the Tokyo Stock Exchange, having raised 29.8 billion yen ($271 million) in an initial public offering priced at the top of its marketed range.

The Taiwanese company’s shares were priced at 1,600 yen each in the IPO and got a significant bounce at the open, rising as much as 37% in early trading before paring gains to close up 19% at 1,900 yen. SoftBank Group Corp. and Asean China Investment Fund III were among holders who offered shares, according to Appier’s filings, with Masayoshi Son’s firm holding about a 4.4% stake.

While Tokyo has been attempting to attract more foreign companies amid a broader push to become a financial hub, such listings remain unusual. Appier is the first firm from Taiwan to list in Tokyo since Trend Micro Inc.’s debut in 1998, according to the Nikkei newspaper.

“Japanese investors have a high acceptance of the artificial intelligence theme and the market accounts for a large part of our revenue,” Chih-Han Yu, Appier’s chief executive officer, said in a briefing Thursday, explaining why the firm chose Japan.

Appier’s debut comes amid a broader selloff in technology shares as investors rotate out of loftily valued growth stocks into more economically sensitive sectors like banking. Chinese tech names in particular have slumped due to a combination of rising interest rates and increased regulatory scrutiny in the U.S. and China. The listing on the Mothers market follows last Tuesday’s debut in Hong Kong of internet giant Baidu Inc.

“Many software companies opt for the U.S. market because software valuations tend to be higher there,” said Bloomberg Intelligence analyst Matthew Kanterman, “but successful listings in other markets could begin to open up other opportunities for companies to consider.”

Appier and shareholders sold 18.6 million shares last week after marketing them at 1,400 yen, 1,500 yen or 1,600 yen apiece. Its AI-based software is used by customers including Alphabet Inc., Toyota Motor Corp. and Estee Lauder Cos. to improve profitability, the company said. Appier plans to use the proceeds of the share sale to support growth, including funding research and development.

The company had a net loss of 1.45 billion yen on sales of 8.97 billion yen in 2020. The offering was led by SMBC Nikko Securities Inc., Bank of America Corp. and Mizuho Securities Co.

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