Tokyo Metro aims to raise up to $2.4 billion in Japan's biggest IPO since 2018

Tokyo Metro set a price range of 1,100 to 1,200 yen/share for its initial public offering (IPO) yesterday, according to documents filed with the capital market regulator, Reuters reports.

If the upper end of that range is taken into account, Tokyo Metro, one of two subway operators in the Japanese capital, would raise ¥349 billion (about $2.35 billion) in Japan's largest IPO since the last six years.

The subway operator's final IPO price will be decided on October 15, ahead of its listing on the Tokyo Stock Exchange, which is scheduled for October 23.

The Tokyo subway was created in 1920 with the establishment of the Tokyo Underground Railway Co. Seven years later, the company inaugurated Japan's first subway line between Tokyo's Asakusa and Ueno districts. Tokyo Metro operates 195 kilometers of lines and carries 6.5 million passengers daily. Currently, the company also has real estate and retail divisions. The Japanese central government owns 53.4% of the shares of Tokyo Metro, the rest being controlled by the local authorities in Tokyo. The company's IPO follows the listing of other Japanese rail operators, including Kyushu Railway, in 2016. The company reported a net profit of 46 billion yen for the financial year ending March 31, 2024, up more than 60% from a year earlier . Brokerage firms Nomura, Mizuho and Goldman Sachs are handling the Tokyo Metro listing.

Also in Japan, Rigaku, a maker of X-ray testing tools backed by investment firm Carlyle Group, plans to list this month, according to Reuters. In contrast, Bain Capital-backed chipmaker Kioxia abandoned its plan to launch an IPO in October.

Japan's stock market suffered a historic crash in early August, triggered by a surprise interest rate hike and fears of a US recession, before recovering. The benchmark Nikkei 225 is up about 18% this year.