Porsche Is Only Worth Almost Half Of Hoped For IPO Figure, Analysts Claim
Porsche is shrugging off financial market fears and preparing to launch itself onto the stock market where it hopes to attract a valuation as high as €85 billion ($85 bn). But some analysts think its true value could be little more than half of that figure.
Earlier reports in financial media suggested Porsche could be worth between €60-85 billion ($60-85 bn), and parent company Volkswagen will have its fingers crossed that it realizes the higher number, or at least comes close. But market experts at HSBC Holdings reckon the performance car brand is really only worth €44.5-56.9 billion ($44.4-56.9 bn).
HSBC’s analysts warned that Porsche’s pricing power – the ability to raise prices without weakening demand – could slip back as the car industry recovers from parts shortages and the supply of vehicles improves, Bloomberg reports. HSBC also cautioned that demand for Porsche’s cars could take a hit if the world falls into a recession, as some have predicted.
The analysts arrived at their valuation by comparing Porsche with Ferrari, Mercedes-Benz, and BMW. But earlier this year some analysts suggested that Porsche shouldn’t be likened to Ferrari because it produced far more vehicles each year and wasn’t a true luxury brand. While Ferrari sold a record 11,155 cars in 2021, Porsche shifted a staggering 300,081.
While it was no secret that Volkswagen was considering launching Porsche onto the financial markets, it only gave the final go-ahead at the start of September. Porsche is likely to hit the Frankfurt stock exchange later this month or in early October, though only 12.5 percent of the company will be available to investors and none of the shares will carry voting rights.
Volkswagen says the cash generated will help speed up the group’s transition to electric power, which would include the construction of battery plants.