Li-S Energy (ASX:LIS) share price explodes 200% higher after ASX IPO

Get ready for a rocket IPO story…

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The ASX boards are welcoming a new entrant today. Li-S Energy Limited (ASX: LIS) has just completed its initial public offering (IPO) this morning. And boy, what an ASX debut it has been so far. At the time of writing, the Li-S Energy share price has exploded by an incredible 210% from its IPO price of 85 cents. It’s current share price is sitting at $2.62.

This company is being spun-out of PPK Group Limited (ASX: PPK) after weeks of rescheduling. It brings with it a prospect of a new, cheaper, safer and more efficient battery technology called Lithium-Sulphur (Li-S). Lithium-sulphur batteries are a candidate to replace the current dominant lithium-ion battery technology.

According to Li-S Energy, Li-S batteries offer the potential of a far more advanced battery. This is reportedly due to the following:

The theoretical energy density of a lithium-sulphur battery is in the order of five times that of a standard lithium-ion battery… They are also lighter, safer, faster charging, and using more environmentally friendly raw materials.

However, Li-S Energy also notes that this technology has the following drawbacks:

Lithium-sulphur batteries have yet to be mass produced. Historically, the challenge in developing lithium-sulphur batteries has been effectively optimising and stabilising the battery components during charge and discharge cycling.

Lithium-sulphur batteries tended to fail after a low number of recharge cycles, making them of little use for most applications.

Li-S Energy is obviously vying to overcome these barriers and commercialise this exciting technology.

How did the ASX Li-S Energy IPO work?

So according to the company’s ASX release from 24 September, Li-S Energy has raised $34 million through the issuance of 40 million shares. That was at today’s issue price of 85 cents each.

Just a touch over 150 million shares have hit the ASX boards today. But another ~500 million shares will be placed in escrow. These will be restricted from trading until either April 2022 or September 2023.

It will be interesting to see what the Li-S Energy share price does over the next few days after this explosive ASX debut today.

Should you invest $1,000 in Li-S Energy right now?

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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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