Lyft Kicks Off IPO With USD 24.3 Billion Valuation

Lyft Kicks Off IPO With USD 24.3 Billion Valuation

United States ride-hailing platform Lyft accelerated onto Wall Street on Friday in its listing debut.

Although the company reported a 2018 net loss of almost a billion dollars, investors clamored for a piece of the Lyft IPO, with underwriters reporting demand for the stock that was 20 times larger than the shares available, the Wall Street Journal said.

As for the future trend of transportation, ride-hailing companies are eying autonomous driving as the next prospect to hit of the market.

"Lyft has been successful against big odds because we have always prioritized the long term sustainable growth of both our community and our company", Zimmer said at the event.

The benchmark S&P 500 index is now up 13.1 percent this year, a drastic turnaround for stocks after a jarring 14 percent sell-off in the last three months of 2018. The firm chose to raise its price range last Wednesday by as much as Dollars 2.2 billion and investors have already been advised to place orders above the elevated range to increase their chances of succeeding. "So I look at what I'm getting as a part owner of a business, and I don't know why, with all the things you can buy for $25 billion in this world, that you would pick a business that really has to be earning $2.5 or $3 billion pre-tax in five years to even be on the same radar screen as things you can buy right now". It debuts on the Nasdaq this morning, sporting the ingenious ticker symbol of...wait for it...

The IPO represents a watershed moment for ride hailing, an industry hatched from the rise of smartphones.

Uber and Lyft signs are seen on a vehicle in Redondo Beach, California, U.S., March 25, 2019.

Uber and Lyft are among the most prominent firms in the sharing economy, which also includes home-sharing platform Airbnb, and highlight a trend away from ownership to services.


Aggarwal also said the company's co-founders, CEO Green and President John Zimmer, worked in recent weeks to make investors comfortable with Lyft's dual-class share structure, which has faced criticism from some investors and corporate governance advocates. Uber, a global logistics and transportation company most recently valued at $76 billion in the private market, is seeking a valuation as high as $120 billion, although some analysts have pegged its value closer to $100 billion based on selected financial figures it has disclosed.

But Lyft lost $911 million (roughly Rs. 6,325 crores) on $2.2 billion (roughly Rs. 15,276 crores) in 2018 revenues.

Some of the companies' losses come from subsidizing rides, a tactic to attract riders with discounts. Uber later added peer-to-peer ride haling to its app.

Lyft's IPO, which is the year's biggest thus far, sets the stage for other Silicon Valley unicorns seeking to debut in the stock market this year, including Pinterest Inc, Postmates Inc and Slack Technologies Inc.

Meanwhile, Lyft parlayed a warm and fuzzy image that it used to cultivate by adorning drivers' cars with a fluffy pink mustache to position its brand as the more socially responsible of the two ride-hailing rivals. By contrast, Uber has expanded overseas and is experimenting with food delivery, boats and freight operations.

Lyft priced its IPO at $72 on Thursday night, putting its value at more than $24 billion. "It's got that David vs. Goliath theme that consumers love", so much so that it may help Lyft's growth over the next decade as Uber's aggressive push begins to stagnate.

Co-founder Zimmer sounded upbeat.

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