The Hipages Group Holdings Limited (ASX: HPG) share price has had a mixed start to life as a listed company.
This morning the tech company's shares landed on the ASX boards following the completion of its initial public offering (IPO) that raised $100.4 million at $2.45 per new share. This gave Hipages a market capitalisation of approximately $318.5 million.
In early trade, the Hipages share price climbed as much as 16% to $2.85. However, it has since given back these gains and is currently trading flat at $2.45.
What is Hipages?
Hipages is a leading Australian-based online platform and software as a service (SaaS) provider that connects tradies with residential and commercial consumers. It currently has 36,000 tradies subscribed to the platform.
Based on the number of jobs posted, it is the leader in the on-demand tradie economy. The company notes that to date, over three million Australians have changed the way they find, hire, and manage trusted tradies with Hipages.
The Hipages IPO.
The company advised that its IPO received strong demand from a broad range of retail and institutional investors in Australia and New Zealand.
Its largest shareholder will be News Corporation (ASX: NWS) Australia, with a 25.7% interest. The media giant didn't sell any shares under the offer and remains a committed and supportive strategic investor in Hipages.
Approximately $40 million in gross proceeds was raised through the issue of new shares by the company. The net proceeds will be used to drive future growth through investment in its brand and technology platform, as well as its expansion into new channels and adjacent opportunities.
Hipages Chair, Chris Knoblanche, commented:
"Today marks an important step in our evolution with Hipages well positioned to take advantage of powerful digital and community trends that will drive increased demand for our innovative solutions. We believe Hipages has a significant role to play in improving the engagement of Australians with a wide range of trade services. My fellow directors and I are delighted to welcome our new shareholders to the register and thank existing shareholders for their ongoing support, as we embark on the next phase of our journey."
Hipages Co-Founder and CEO, Roby Sharon-Zipser, added:
"With 1.4m jobs posted to our platform in FY2020, Hipages is the leading online platform connecting consumers and tradies in Australia. Our listing today on the ASX represents an important milestone for Hipages and its shareholders as it will enable us to entrench our sector leadership and drive further innovation that benefits both tradies and their customers."
Outlook.
In its prospectus, Hipages is forecasting FY 2021 total revenue of $53.9 million. This will be 15% higher than the prior year. Recurring revenue growth is expected to be 20%.
Pleasingly, the company has started the year strongly and is tracking ahead of its prospectus forecast.
During the first quarter of FY 2021, it delivered total revenue of $13 million, up 17% on the prior corresponding period. Recurring revenue grew 24% during the quarter.
Positively, management advised that October revenue growth has continued at similar levels.
