Cellular Goods stock surges 310% in early trading
Shares in cannabinoid company Cellular Goods, started trading on a high on Friday in its launch on the London Stock Exchange.
The company, backed by footballer David Beckham, saw its stock rocket by 310% to 20.50p at 8.15am from its initial price of 5p.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, commented on Friday: “With shares 13 times over-subscribed, initial demand for cannabinoid company Cellular Goods was always likely to be high and as trading has got underway it’s become a hot stock.
“Shares lifted to just over 29 pence, before falling back to 23 pence, still more than four times the issue price of 5 pence per share. The surge in the share price values the company at more than £100m.
“Unlike many other IPOs which have made a debut on the market in recent months, this offer was open to investors, large and small. 192 million shares have been conditionally placed with institutional investors, and another 68 million were allocated to retail investors with 6,000 signing up through the Primary Bid platform."
The 260m shares on offer represent 51% of the company.
According to Streeter, the footballer’s backing a few weeks ago gave the company popularity for its listed debut.
DB Ventures, Beckham’s commercial business took a minority stake (5%) in the business, which makes skincare and topical creams to provide relief for athletes using biosynthetic cannabinoids. Its value rose more than £2.5m to £3.9m.
“It’s forecast that the global CBD skin products market alone could grow by a quarter over the next five years to almost $3.5bn. But already it’s a highly competitive field, with innovations coming thick and fast from all over the world,” added Streeter.
CEO Alexis Abraham, who founded the company in 2018, told the Evening Standard: “We are delighted with the tremendous support we have received from institutional capital and the unprecedented level of interest shown by retail investors for an IPO of this size."
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