Porsche might be going public later this year. The IPO would reportedly see the automaker valued at around €85 billion ($95.83 billion). Volkswagen Group and Porsche Holding SE have entered a framework agreement for the listing, and as a result an IPO could happen by Q4 2022 at the earliest.
Up to 25% of Porsche would be placed on the market, split evenly between ordinary and preferred shares. That said, nothing is set in stone. Volkswagen released the following statement last Thursday:
“The actual feasibility of an IPO depends on several different parameters as well as general market conditions. No final decisions have yet been taken.”
Volkswagen CEO Herbert Diess seemed more eager for the IPO however, believing now is the perfect time to raise funds for the VW Group's transition to electric:
"For me, this marks an inflection point and the ideal timing for the potential transaction in order to ignite our EV shift momentum."
Porsche's large valuation is less to do with sales volume and more related to brand recognition and prestige. Luxury automakers typically have higher value-to-earnings ratios than traditional manufacturers. For example Ferrari trades at 41 times their estimated earnings meanwhile Toyota is worth around 6 times its annual earnings.
That said, for a high-end manufacturer Porsche does sell a decent amount of cars. In 2021 they sold over 300,000 vehicles - including 41,296 all-electric Taycans. However, the biggest seller was the Macan crossover. A fully electric version of the Macan will be unveiled later this year, and it should seriously bolster Porsche's EV output.
Volkswagen stock rose sharply following news of the potential IPO, with preferred shares surging by up to 10%. Holding company Porsche SE, created in 2007, holds 53.3% of Volkswagen's voting rights and has seen a 7.5% increase in value over the past week.