Why does Jio want to list in US stock exchanges?
Last year there were rumours, suggesting that Jio may get listed in US stock exchange NASDAQ instead of Indian exchanges. Why do jio or other companies want to get listed in US?
Recently, Coupang, a South Korean eCommerce giant, get listed in US, giving listing gains of 70% and raising the valuation to $108.9 Billion. It was the largest IPO of the year and became the largest foreign company to make its debut post Alibaba in 2014.
Coupang might haven’t gotten the same valuation if it was listed in South Korean exchange. US has two of the world largest exchanges NYSE, with a market cap of over $20 Trillion and NASDAQ, with a market cap of over $10 Trillion. It reflects there is a large pool of financial investors and indeed capital, which helps companies in getting higher valuation as well as liquidity.
Secondly, the trading volume is way higher than rest of the exchanges in the world. NYSE, leading the charge with monthly trading volume of worth $1.5 Trillion and NASDAQ at the second place with $1 Trillion. Lastly getting listed in US provides a credibility that the company is genuine enough.
Recently Snapchat’s parent company, Snap, crossed the market valuation of $100 Billion. Would it be same if the company was listed in Indian exchange. Most of the companies trade at a higher P/E ration in US exchanges. Maybe now you have the answer why Jio plans to list in an US exchange.
Cheers to the cohort members for continuing the Tiny Project for Day 11!
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