Shares of online coupon company RetailMeNot Inc (SALE.O) rose as much as 36 percent in their market debut on Friday, the latest technology IPO to attract investor attention.
RetailMeNot's shares opened higher at $26.50 on the Nasdaq and touched a high of $28.45, valuing the company at about $1.42 billion. The offering of 9.1 million shares was priced at $21 per share, the midpoint of the expected range, raising $191.1 million.
The Texas-based company helps retailers and brands push sales by attracting customers through its websites and mobile applications. The company also drives in-store sales by displaying digital coupons for everything from clothing, electronics, food and entertainment to personal and business services on its mobile apps.
RetailMeNot is the latest entrant into the e-commerce business dominated by Facebook Inc (FB.O) and Groupon Inc (GRPN.O).
"Investors have higher expectation for growth of this category. They can be successful in this space, but can attract quite a bit of competition," said Francis Gaskins, a partner at IPO research company IPODesktop.com.
The consumer e-commerce market is projected to more than double to 1.9 billion users between 2012 and 2017, according to market research firm IDC, a huge opportunity for companies such as RetailMeNot.
Companies such as Groupon are also benefiting as more consumers use mobile devices to access online services.
Groupon is selling more deals through smartphones, with mobile transactions in North America jumping to about 45 percent in March from about 20 percent two years ago.
"(RetailMeNot) needs to focus on mobile without question," Benchmark Co analyst Mike Hickey said.
Application downloads on smartphones, tablets, and other mobile computing devices will increase to 187 billion in 2017 from 87.8 billion in 2013, IDC forecast last month. (link.reuters.com/myg79t)
RetailMeNot, backed by Google Ventures and Austin Ventures, said about 450 million people visited its digital coupon websites, including VoucherCodes.co.uk, Deals.com, Bons-De-Reduction.com, in 2012. The company has tie-ups with eBay Inc (EBAY.O), Overstock.com Inc (OSTK.O) and Best Buy Co Inc (BBY.N).
RetailMeNot's revenue rose nearly eight fold to $144.7 million between 2010 and 2012. The company generates about 80 percent of its revenue from the United States.
The company, previously known as WhaleShark Media, is headed by a former chief operating officer of financial website Bankrate Inc (RATE.N), Cotter Cunningham.
Morgan Stanley, Goldman, Sachs and Credit Suisse Securities were the lead underwriters for the offering.
RetailMeNot's shares were up 32 percent at $27.62 on the Nasdaq. More than 8 million shares changed hands by 1340 ET.
(Reporting By Neha Dimri and Chandni Doulatramani in Bangalore,; Editing by Ted Kerr and Sriraj Kalluvila)