Natura's successful IPO is oversubscribed, share prices rise
Novo Mercado, Wednesday, rose 12 per cent in heavy early afternoon
trade as the country's first IPO in more than two years proved
popular with investors, writes Louise Sheridan.
Reuters news agency has reported that at one point shares in Natura Cosmeticos stock were nearly 12 per cent higher than their 36.50 reais (€9.53) opening price, at 40.80 reais (€10.65), at a time when the Brazilian Bovespa stock exchange was 0.3 per cent in the black.
The Novo Mercado is a segment of Bovespa designed for companies that voluntarily undertake to abide by corporate governance practices and disclosure requirements over and above those required by Brazilian legislation.
According to the Brazilian Securities Commission, the share sale has raised 768 million reais (€200 m). As previously reported by CosmeticsDesign, Natura's shareholders aimed to offer 20 per cent of the company's capital to realise Brazilian Reals 623.6 million (€173 m) through the flotation.
The flotation was reportedly oversubscribed ten times, with international investors taking a particular interest in the offering.
According to Euromonitor, which recently published a report entitled 'Cosmetics and Toiletries in Brazil', Brazil's cosmetics and toiletries market has achieved 113 per cent growth since 1997 and is now the seventh largest in the world, at US$7.3 billion (€6 bn).