Recruit Holdings President and CEO Masumi Minegishi rings
Tokyo - AFP
Japanese staffing giant Recruit Holdings soared 7.4 percent on its trading debut on Thursday after a nearly $2.0 billion initial public offering, one of the biggest in Tokyo this year.
The firm ended its first trading day at 3,330 yen ($31), well up from its IPO price of 3,100 yen. That came even as the broad-based Topix index, on which it is listed, tumbled more than two percent following heavy losses in New York and Europe.
As of Thursday's close, the company was valued at 1.91 trillion yen, slightly bigger than electronics giant Toshiba at 1.83 trillion yen.
Market-watchers said Recruit's strong debut reflected high expectations that the firm would pursue overseas acquisitions.
Recruit's top executive said the firm was aiming to be the world's top staffing agency by 2020.
"We're looking to boost profitability of the foreign companies we've already purchased and also grow through mergers and acquisitions," Masumi Minegishi told a news conference on Thursday.
The company, who launched a shared sale this month worth 197 billion yen ($1.85 billion), has human resources offices across the globe and posted sales of 1.19 trillion yen in past the fiscal year to March.
It is also involved in other sectors including publishing and advertising.
"Investors see Recruit is still a company with further growth," said Mitsushige Akino, chief fund manager at Ichiyoshi Asset Management.
"Generally, Recruit is known as a company with employees who have good sales skills," Akino told Dow Jones Newswires.
"So can they handle M&As? Do they have people in that field? That's a key question."
Hirokazu Kabeya, senior strategist at Daiwa Securities, told AFP it was "unfortunate" that Recruit's listing came on a day the Topix and the closely watched Nikkei suffered heavy selling pressure.
But he added that "given the market climate today, it is doing relatively well".In March, Japan Display, the world's biggest maker of screens for smartphones and tablets, held an IPO worth about $3.2 billion, but its shares have struggled since and remain way below their opening price.
Recruit has long been associated with a major political donation scandal in the 1980s when Japan's economy was booming on the back of a surge in stock and real estate prices.
A string of politicians were accused of taking shares in Recruit Cosmos, a real estate affiliate, and making handsome profits after they were listed.
Noboru Takeshita quit just 19 months into his premiership in June 1989 after being implicated in the scandal.