Baltic Companies Increasingly Choose IPOs to Raise Capital and Promote Local Business

Strategic Insights -

In recent years, a growing number of Baltic and Latvian companies have opted for an initial public offering (IPO) to trade shares on the stock exchange, allowing them to raise additional capital and offer investors the opportunity to become company owners or purchase bonds. This trend has seen several well-known companies, such as LATRAPS, Elevating Group, and Grenardi Group, use IPOs to join the Nasdaq Baltic exchange. According to SEB banka, AS, their clients are actively taking advantage of this opportunity, with most factors at play being the companies' local nature, making them more understandable to investors, and the chance to invest in the local market, supporting its development and promoting entrepreneurship.

Key Takeaways:

  • The number of Baltic and Latvian companies choosing IPOs to trade shares on the stock exchange has been increasing in recent years.
  • Companies opting for IPOs include LATRAPS, Elevating Group, Grenardi Group, Delfin Group, Storent Holding, Orkela, REFI Energy, and others.
  • Investors are attracted to the opportunity to become co-owners of local companies or purchase bonds, supporting local market development and promoting economic growth.
  • Local companies are seen as more understandable to investors due to easily available information and clearer development prospects.
  • IPOs allow investors to invest in the local market, supporting its development and promoting entrepreneurship.
  • Patriotism also plays a role in investors' decisions, as they see the investment as supporting the local market.
  • SEB banka, AS reports that their clients are actively taking advantage of this opportunity.
  • Companies usually choose between allowing the purchase of shares or bonds during an IPO.
  • A stock IPO allows investors to become co-owners of the company, while a bond IPO is similar to a loan, guaranteeing repayment with interest after a certain period.
  • A stock IPO allows higher potential returns, but also involves higher risk.
  • Financial instruments vary in complexity, with options such as call options and early redemption financial instruments worth considering before investing.
  • New or less experienced investors are recommended to start with conventional financial instruments.

Statistics:

  • The number of Baltic and Latvian companies choosing IPOs is increasing.
  • Companies opting for IPOs include LATRAPS, Elevating Group, Grenardi Group, Delfin Group, Storent Holding, Orkela, REFI Energy, and others.
  • A stock IPO allows investors to become co-owners of the company, while a bond IPO is similar to a loan.
  • The potential for returns from stocks is usually higher than from bonds.
  • Financial instruments can be both simple and complex.

Sources:

  • SEB banka, AS
  • LATRAPS
  • Elevating Group
  • Grenardi Group
  • Delfin Group
  • Storent Holding
  • Orkela
  • REFI Energy