Doughnuts, wine and tacos: 10 stockmarket newcomers to watch

Big-name businesses in Australia and overseas are offering investors a chance to buy in. Here are 10 to keep an eye on.

A surge in sharemarket floats is giving Australians the chance to buy into businesses that were previously only available to a wealthy few.

Almost 100 new stocks debuted on the Australian Securities Exchange between January and July, including Airtasker and Best & Less, while initial public offerings (IPOs) for food company Guzman y Gomez and online wine business Vinomofo look likely soon.

Almost 30 companies are scheduled to list on the ASX in September alone. Others are listing in the US but can still be bought via share trading platforms.

OnMarket managing director Nick Motteram said there could be 150 IPOs this year “which is definitely above the average”.

“People aren’t getting much of a return on interest or bonds, and there’s a lot of cash out there,” he said.

Mr Motteram said many investors missed out on buying into an initial IPO because they weren’t clients of the stockbrokers involved, but waiting until after a stock listed could be beneficial.

Best & Less Chairman Jason Murray and CEO Rodney Orrock have overseen solid growth.

“Then there’s more understanding of the general market sentiment towards it,” he said.

Shaw & Partners senior client adviser Jed Richards said he screened IPOs, because many today aimed to make money for their private equity vendors rather than everyday investors, and found only about 10 per cent were worth sharing with his clients.

An IPO was riskier than buying shares that were already on the market because “you don’t know what it’s worth”, Mr Richards said.

“You don’t have a live share price, and the market will ultimately set its valuation.”

Here are 10 notable companies that have recently listed, are planning to float, or remain a rumour.

1. BEST & LESS

This clothing retailer joined the ASX last month and its shares have climbed about 30 per cent above their $2.16 IPO price. It announced a record annual profit in August but admits Covid-19 lockdowns are creating “challenging” conditions.

2. F45 TRAINING

The Aussie fitness giant chose to list on the New York Stock Exchange in July, and was valued at $2 billion. However, its shares have dropped more than 10 per cent since its debut.

3. AIRTASKER

The gig economy company surged on its ASX debut in March but its share price has since tracked sideways. Founder Tim Fung has retained his stake – which is a good sign, advisers say.

Sprinter Morgan Mitchell is an ambassador for f45.

4. GUZMAN Y GOMEZ

The fast-growing Mexican food company had planned to list on the ASX in November, but has put it on the backburner for 12-18 months. It has expanded overseas and plans 500 outlets in Australia.

5. VINOMOFO

Online wine retailer Vinomofo is reportedly planning to announce an IPO before the end of the year and has lined up investment bankers to assist with the process. It has benefited from Covid-19’s online shopping boom.

6. ZOOM2U

The company has a parcel delivery platform that connects couriers to customers across Australia, and is scheduled to list on the stock exchange on September 10.

7. FOXTEL

Rumours of a Foxtel float within the next 12 months are swirling in financial markets following the strong success of its streaming services Binge and Kayo, but the business and its 65 per cent owner News Corp have declined to comment.

The Krispy Kreme doughnut company plans a US stockmarket IPO. Picture: Tertius Pickard

9. KRISPY KREME

This could be a sweet deal for investors who are happy to buy overseas stocks. The US doughnut giant is planning an IPO this year that values it above $4 billion – more than twice what a private equity company paid for it in 2016.

10. KUNIKO

This subsidiary of lithium producer Vulcan Energy surged more than 500 per cent on its ASX debut in late August, showing the potential profit for investors who buy into an IPO early.

HOW TO INVEST IN AN IPO

• An initial public offering (IPO) is when a company offers shares the to public and then lists them on the stock exchange.

• Gone are the days of large public IPOs such as Commonwealth Bank, Telstra, AMP or Medibank where most people could buy in.

• Today, investors typically must have an account with the stockbroking firm managing the IPO if they want access to the listing.

• They will have to complete and application form found in a prospectus obtained from their stockbroker, and there may be maximum or minimum share limits.

• The ASX has an overview of the IPO process and details of upcoming floats at asx.com.au.

Source: OnMarket, Australian Investors Association

Originally published as Doughnuts, wine and tacos: 10 stockmarket newcomers to watch