How to participate in the Upcoming Fix Price IPO

On Feb 15, 2021 Fix Price – Russian discount retailer filed the paperwork with London stock exchange for a listing (secondary Moscow listing) that could value the company at more than $8,2bn. The IPO which may raise $2B, would be the largest by a Russian company in London since 2017.

• Detailed instructions how to participate in Fix Price (pre-IPO, offering price) see below👇

What is an Initial Public Offering and how it works

IPO is a process of offering shares of a private corporation to the public in a new stock issuance. Why go public? The primary benefit of going public is easier access to capital.

To go public, a company must have a track record of growth and other favorable results and hire an investment bank (BofA Securities, JPMorgan, Citigroup, Morgan Stanley, and VTB Capital in Fix Price case) to come in and underwrite the IPO. The underwriters also performed due diligence and verified financial information and business model.

Once the paperwork done, the company sells the stock to institutional investors. When the initial block of shares has been sold, the company with underwriters' help sets an initial price and date for the stock to begin trading on a stock exchange.

Company Profile and Financial Indicators before Fix Price IPO

The company was founded by Sergei Lomakin and Artem Khachatryan in 2007, founders and executives of the former Kopeyka (supermarket) chain.^[5]Goldman Sachs Group, Inc acquired a stake in the company in 2020.

The discounter store chain has a range of about 1,800 products, including household goods, cosmetics and food, which it sells at fixed prices all under Rubles 250 ($3.40), with about 80 per cent under Rubles 100 ($1.03). Fix Price operates more than 4,200 stores across Russia and Eastern Europe. 2020 revenues increased by 33% to Rubles 190.1bn ($2.6bn), with net profit of Rubles 17.6bn. Sales have risen at double-digit rates every quarter for 16 consecutive quarters.

How to Buy Fix Price Stocks Before the IPO (Offering Price)

In the past, IPOs as highly profitable investments were available only to the privileged customers of the leading brokerage firms and it was challenging for retail investors to gain access. You couldn't buy shares paying the price set by the company and you had to wait until the shares actually start trading on the public stock market at whatever stock price supply and demand allows.

Technologies and marketplaces changed the rules of the game, now regular investors can get pre-IPO shares. To participate in Fix Price IPO you need to use an IPO investing app like Freedom Finance (NASDAQ: FRHC), TD Ameritrade or Fidelity. They give its customers access to IPOs and secondary offerings through their existing brokerage account. Also you can buy Fix Price shares when the company goes public via a commission-free trading app like Webull.

🚨 Detailed Instructions How to Participate in the Fix Price IPO before public trading:

Below we share the instruction how to participate in the approaching Fix Price IPO using Freedom Finance (Tradernet platform).  This marketplace is chosen because almost all high-profile IPOs are traded via this platform

• Pros: almost all high-profile IPOs are available for participation via Freedom Finance, no eligibility requirements, no number of previous trades needed and low minimum investment amount for participating in an IPO.
• Cons: the user interface of the platform is a bit outdated.

* Freedom Finance services are NOT available to US citizens and residents.

1. Apply for a Freedom Finance account — you need to prepare your identity document and a document confirming the address of residence (utility bill). The verification process is very fast, it will take 2 minutes to create your account.
2. Deposit your account — to participate in an IPO, your account must have available funds in the amount you send IPO application for.
3. 💡 Tip: It's recommended to deposit your account in advance. Often the exact IPO date is undefined until the last day. You may have a short notice for participation and account deposits also takes time for processing. Also, sometimes Freedom sends last-minute IPO offer when you have 2 hours to participate.
4. Submit a request to participate in the IPO — when applications are open select Fix Price and click Participate in the IPO > input the amount you want to invest > Send your application. Note: Before the book closing, a request can be withdrawn. At the time of the book closing, 1 day before the start of the exchange trading, the specified amount will be blocked on the account.
5. Wait for allocation — The actual number of stocks purchased during an IPO depends on supply and demand. The higher underwriter reserves the right to partial execution of collective applications. So if the demand is high you may get less than you applied for. Of course, you will only pay for the shares purchased. The rest of the funds will be returned to your account.
6. Start of trading — With the beginning of the public trading on the stock exchange, the purchased shares will appear on the account and a lock-up period will start — a 93-day period of prohibition on sale. You can’t sell stocks, but you can track their current value and growth indicators in your personal member area and a trading terminal.
7. Closing your trade — At the end of the 93 days lock-up period, you will be able to manage your stocks at your discretion — leave in the portfolio or sell and withdraw money or transfer the stocks to another depository/ broker in your name. This can be done in your account by clicking the ‘Sell’ button next to the name of the security. In this case, a commission of 0.5% of the amount of the sale transaction is charged.

Is investing in IPOs profitable?

Not always. The average return at the end of the lock-up period is 72%, past IPOs data.

When is the Fix Price IPO date?

Mar 10, 2021

What is Fix Price IPO price range?

Fix Price set the final offer price for its initial public offering (IPO) at $9.75 per global depositary receipt (GDR), the top of its target range, implying a market capitalisation of $8.3 billion.

How to Invest in Fix Price after the IPO date (opening price)?

After the IPO you can buy Fix Price stocks via Tradernet on the first trading day. Also you can use a commission-free trading app like Webull.

In what currency Fix Price IPO and post-IPO shares will be traded?

The Fix Price IPO and stock trading currency will be GBP and RUR.

If you have funds in another currency the cheapest way to convert your currency is to use the mid-market rate (that’s the one you’ll find on Google) which can be done via a fintech service like Transferwise. Banks may add hidden markups to their exchange rates - charging you more without your knowledge. And if they have a fee, they charge you twice. TransferWise never hides fees in the exchange rate.

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What is the Fix Price (stock symbol)

The stock ticker for Fix Price will be Undefined

Sources used: Reuters, Financial Times, RBC News