Porsche replaces VW as the most valuable car manufacturer in Europe

Porsche has become Europe’s most valuable automaker, taking the crown from parent company Volkswagen just a week after going public in one of the region’s largest IPOs.

Shares of the sports car group climbed 3.5 percent on Thursday to 91 euros, giving Porsche a market capitalization of 82.9 billion euros and eclipsing Volkswagen, which was valued at 78.3 billion euros.

VW defied a bleak economic backdrop and the downturn in global stock markets to sell 12.5 percent of Porsche, its most profitable brand, as the group seeks to fund a big push into electric vehicles.

While VW has lost its title, Porsche’s rapid ousting of its parent company as Europe’s most valuable automaker provides justification for the IPO. VW executives had hoped investors would value Porsche more highly, a luxury brand that produces far fewer cars than its parent company.

The shift in valuations between the two groups mirrors what happened to Italian sports car maker Ferrari, whose valuation dwarfed that of its parent company Fiat following its 2015 IPO.

After selling for €82.5 apiece, Porsche shares rose on their debut and have since outperformed the leading German index, the Dax. However, the share price was supported by the IPO advisory banks, which bought the stock between September 29 and October 4.

Shares of Porsche, which sells around 300,000 cars a year versus 10 million that VW sells, had fallen below its IPO price earlier this week.

VW said measures to support the stock were needed in the early trading days because “September inflation data, renewed energy supply concerns in Europe . . . and an aggravation of the situation in Ukraine”, had made the market environment more difficult.

VW plans to return some of the €9.4 billion it raised from Porsche’s IPO to its shareholders via a special dividend and to put money into electric vehicles.

https://www.ft.com/content/10096d96-2ef1-4ece-946f-8e819676cbd2 Porsche replaces VW as the most valuable car manufacturer in Europe

Adam Bradshaw

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