UPDATE: Kogan shares lower on ASX debut
Online retailer Kogan.com has suffered a dismal stock market debut, with its shares tumbling by more than 13 per cent.
Kogan.com shares hit the market at 1200 AEST at $1.80, and within 40 minutes had dropped 12.2 per cent to $1.58.
At 1530 AEST the shares were 24 cents weaker, a drop of 13.3 per cent, at $1.56, while the broader market was stronger.
CMC Markets chief market strategist Michael McCarthy said the disappointing market debut was a concern.
“Kogan has been smashed,” he said.
“It is damaging to the market to see such a well touted stock perform so badly on its first day.”
Kogan.com’s $50 million initial public offering was reportedly four times oversubscribed by investors, and McCarthy said the share price fall didn’t make sense given such strong institutional demand for the stock.
“I wonder if there was a bit of over-egging of the situation in the lead up, because it is certainly not trading like a stock that had four times over cover,” he said.
“You have to ask why some of that oversubscription isn’t in the market picking up its shares, which is at a relative bargain compared to the float price.
“Something is not adding up here and the regulator may have to look at it.”
The poor market debut has wiped $11 million from the value of company founder and chief executive Ruslan Kogan’s 50.5 per cent stake in the business, to $73.5 million.
Comment has been sought from Ruslan Kogan.