Over the last decade, Uber have changed the system of urban transportation and expanded all over the world quite significantly, but the company took a big hit from wall Street on the first day of its IPO. The app-based company, Uber, has suffered losses in the stock market on the day of IPO launch. The company had launched its IPO on the New York Stock Exchange on Friday. For this, company kept the $ 45 price tag. However it was closed late in the evening (US time) at $ 41.57. In this way, the company’s share had suffered a loss of 7.6 percent on the day of launch. Uber closed its second day of trading down more than 18.8% from its IPO price at $37.25 per
Although the company had raised $ 8.1 billion on the first day on the stock market. But it is much less than the previous year’s estimations and company’s target. Uber is now traded at the market cap of $62 billion which is much less than what was estimated by the bankers and company, that after the IPO, market cap would rise to $120 billion.
Even before the arrival of this IPO, the tension between the company and the taxi drivers was increasing. In the US and UK, low-income and uncertain working conditions were called for strikes on May 8 in several big cities. It was one of the reason that investors hesitated from investing in Uber. These cab drivers closed their app and did not accept any booking. Cab drivers say that they will try to encourage people to boycott this app. Protests are also going on near the headquarters of the company located in San Francisco.
Increasing long term debt of Uber might be another concern for investors. Company’s long term debt are rapidly rising and went up to $6.869 in 2018 as compared to $1.423 in 2015.
It is the largest IPO of any US company after Facebook. However, the biggest IPO ever so far came with Alibaba, which raised Rs 1.74 lakh crore ($ 25 billion) in 2014.