With the recent SpaceX IPO having concluded, Schroders head of Australian equities, Martin Conlon, has shared which ones the firm passed on and those where he missed out.
Raising US$75 billion in mid-June, Elon Musk’s SpaceX IPO was officially the largest public debut in history, surpassing Saudi Aramco’s US$25.6 billion in 2019 and Alibaba Group’s US$21.8 billion in 2014. The rockets and AI giant began trading at US$150 per share, well above its IPO price of US$135, and climbed as high as US$175 during the session.
Speaking at a Sydney roundtable, Conlon said: “I am always sceptical of IPOs, there is not much history so you are making a less informed decision than with a company with a lot of history. The burden of proof is if we don’t understand it, then we can’t value it and we won’t buy it.
“The numbers [for SpaceX] were huge relative to history, it was floating at 100x revenue. It was a fanciful valuation, as long as you can engineer a supply/demand imbalance then you can push the price up.”
However, while he swerved the mega-IPO, he admitted there were some past IPOs in Australia where he wished the firm had participated.
“Of course there are great companies that were opportunities at IPO which we wish we had bought, CSL and Cochlear stick out. CSL made its shareholders a phenomenal amount of money and was a very good company for a very long time.
“If a business is readily understandable then it’s easy to price whereas a lot of what is being floated at the moment doesn’t have a simple explanation of what they do and how they make money.”
Shares in CSL listed in 1994 while Cochlear listed in 1995.
“On the other hand, we looked like fools at the time when we didn’t buy Guzman y Gomez at the IPO or afterwards but then it went down a lot and some people lost a lot. We were happy to leave some money on the table there.”
Mexican restaurant chain GYG listed in June 2024 and initially rallied but has the stock has lost 27 per cent since its float. In May 2026, it said it would immediately cease trading its US restaurants after concluding the business was unlikely to generate acceptable financial returns, having previously pushed the US expansion as a future goal at the time of the IPO.
Meanwhile, the asset manager conducted a global investor insight of over 1,000 investors representing US$72 trillion in assets to assess their investment perspectives. This found 85 per cent of global investors are confident active management can help achieve their investment objectives, rising to 91 per cent in Australia.
In terms of their portfolio considerations, 80 per cent are focused on diversification and 74.6 per cent are focused on downside protection – unsurprising given 85 per cent expect to see more volatility over the next year. However, Australian investors plan to use this volatility to their advantage with two-thirds saying they are seeking buying opportunities during this dislocation.
“This signals a more opportunistic stance locally – one that recognises volatility not only as a risk, but also as a potential source of return,” the firm said.
Chief executive, Alison Telfer, said: “In today’s market of high volatility, that investor expectation has only strengthened. Outcomes are less about static allocation and more about how effectively portfolios can adapt; drawing on active management, broader diversification and deliberate risk management to deliver more consistent results.”
