U.K.-based online greeting card company Moonpig Group Plc soared in its London stock trading debut, raising £491 million ($672 million) in its IPO. The shares closed at 410 pence, 17% above the IPO price of 350 pence, after rising to as high as 450 pence, according to Bloomberg.
Sales at Moonpig more than doubled in the six months ended Oct. 31 to £158 million, according to its registration document, as lockdowns forced many people to forgo in-person celebrations and turn to online deliveries of gifts and cards instead. The company said it held a 60% market share among U.K. online card specialists in 2019 and a 65% share in the Netherlands among the top three digital card players.
“It’s remarkable to see a listing by a company that owns this much market share,” said Oliver Brown, a fund manager at RC Brown, told Bloomberg. “They effectively created the segment.”
The majority of the sale proceeds the 41% stake in Moonpig will go to selling shareholders including Exponent Private Equity Partners, which bought the company in 2016. The company, which owns the Moonpig brand in the U.K. and Greetz in the Netherlands, raised 20 million pounds in the offering to pay down debt. It expects to be eligible for inclusion in the FTSE U.K. indexes.
In Moonpig’s registration document, the company management warned it will face increased competition as brick-and-mortar stores shift to online sales and it may not retain its new customers once lockdowns are lifted. The company is counting on its data-driven technology platform to fuel growth. Moonpig’s first-half revenue growth was driven by its mobile app, which saw its share of total orders double to 33% in October from the prior year.