Tokyo Metro shares jump by almost half in market debut

TOKYO (Reuters) -Tokyo Metro's shares shot up 45% in their market debut on Wednesday, after Japan's largest initial public offering in six years raised $2.3 billion. 

Tokyo Metro, one of the capital's two major subway operators, was trading at 1,730 yen ($11.41) in the morning after opening untraded with a glut of buy orders.

The company raised 348.6 billion yen after pricing its IPO at the top of an indicative range at 1,200 yen apiece. The IPO was more than 15 times oversubscribed, with investors drawn to a household name with an attractive dividend yield.

"The listing of a large company familiar to individual investors has a large merit in broadening the investor base," Toshio Morita, CEO of the Japan Securities Dealers Association and former president of Nomura Securities, said before the debut.

Tokyo Metro forecasts a dividend of 40 yen per share for the financial year ending March 2025 and has appealed to investors with perks such as toppings at the noodle eateries it operates.

The company's history dates back to 1920 with the establishment of the Tokyo Underground Railway Company. Seven years later, it opened Japan's first subway line, between the Asakusa and Ueno districts of Tokyo.

It runs 195 kilometres (120 miles) of lines carrying 6.5 million passengers daily.

Its IPO is the largest in Japan since SoftBank Group listed its telecoms unit in late 2018.

Rigaku Holdings, a maker of X-ray testing tools, raised $863 million in its IPO after pricing shares at the top of the range and will debut on Friday. 

There have been $4.9 billion worth of IPOs year to date in Japan, LSEG data shows, the largest amount in six years.

The benchmark index was flat. It has gained 15% year-to-date.

($1 = 151.6400 yen)

(Reporting by Sam Nussey and Miho Uranaka; Editing by Christopher Cushing)