JX Advanced Metals Corp. has reduced the price range for its upcoming initial public offering (IPO) to ¥439 billion yen ($2.9 billion), marking Japan’s largest offering since SoftBank Group Corp.’s 2018 listing. The adjustment, revealed in a filing in Tokyo on Monday, sets the price per share between ¥810 and ¥820, a decrease of up to 6% from earlier projections made just over two weeks ago.
This move has raised alarms for other companies planning IPOs in Japan, particularly considering the scale of JX Metals’ offering. The reduction in pricing signals a potential slowdown in demand following a record-setting year for IPOs in 2024. Last year saw a surge in IPO proceeds, totaling ¥960 billion, boosting optimism for 2025. However, JX Metals’ adjustments suggest a shift in investor sentiment, especially after a strong debut from the first listing of the year in Tokyo.
Takamasa Ikeda, a senior portfolio manager at GCI Asset Management Inc., expressed concern, stating, “JX’s IPO has become a focal point of anxiety in the market. The price cut indicates that the initial valuation was too high for investors, which could lead to poor post-listing performance.”
JX Metals, a subsidiary of Japan’s largest oil refiner, Eneos Holdings Inc., is selling a portion of its shares in the offering. Eneos has outlined plans to use the funds raised to enhance shareholder returns and invest in decarbonization, as part of its strategy to achieve a 10% return on equity by March 2026.
The IPO also highlights the growing demand for semiconductor-related materials. JX Metals controls over 60% of the global market for sputtering target materials, essential components in semiconductor circuitry. The company faces competition from global players such as Honeywell International Inc. and Konfoong Materials International Co. in China.
JX Metals generated ¥26.4 billion in operating profit from its semiconductor materials division during the fiscal year ending in March 2024, accounting for about 30% of the company’s total ¥86.1 billion profit. The company expects an 11% increase in earnings for the current fiscal year.
However, the broader market sentiment has turned cautious since the initial pricing announcement. The Nikkei 225 Stock Average has dropped nearly 5%, driven by growing concerns over tariffs and a selloff in semiconductor stocks.
Andrew Jackson, head of Japan Equity Strategy at Ortus Advisors, noted, “Investors are taking a more conservative stance toward tech and AI stocks, and the timing of JX Metals’ IPO is far from ideal.”
The recent developments suggest that JX Metals’ pricing adjustments could have broader implications for Japan’s IPO market, signaling that investor enthusiasm may be waning in the face of shifting economic conditions.
Related topics:
EUR/USD Faces Pressure as US Tariff Threats Target the Euro
Gold Price Holds Above $2,900 as US Tariff Concerns Fuel Safe-Haven Demand
NZD/USD Remains Under Pressure Amid Tariff Uncertainty and RBNZ Rate Cut Expectations
