AML - Stock Market Listing

[jonby]

Jon39 said:

jonby said:

Price now 1776

As a financial man Jonby, did you foresee this?
Being one of the stockmarket biggest one day fallers (7.5% at present), is not what they would have hoped for.

There was so much hype leading up the IPO to boost the float price, and the 2017 profit was only achieved by balance sheet accounting, which is very important to fundamental investors.
OK for the sellers. However, considering the seller aspect, what puzzles me, is that I don‘t think the Italian owner did sell completely.

We are only talking about a one day movement, but an IPO first day is often remembered.
Selecting a price which results in a first day increase, is a good way to start.

22 years since I was in fund management ! Haven't really followed the IPO in great detail and I've tended to steer clear of individual equity investments since I was in the industry as it just doesn't seem the same as an 'outsider'. I'm an all or nothing type of person

I suppose my point was that I haven't studied the IPO docs particularly, but I'm assuming if the plans for huge jumps in profitability don't work, it's not a question of whether the company is worth 3 bil or 5 bil, it's a question of is it worth billions or is it a complete disaster

So in turn, are these limited run cars at huge margins sustainable to repeat each year or have they shot their load and will DBX/Lagonda (and in turn the Welsh factory) work. Both are million dollar (or billion dollar !) questions. As a customer, whilst some of the recently announced megabucks projects hold more passing interest than others, none are remotely possible for me as a purchase so in some ways I feel a little more distanced from AML. I get the impression some others on here do too. I also have far too little fundamental understanding of the type of people who spend £7M on DB4GTZag continuation plus a rebodied DBS to know if that kind of project is sustainable. So I really have no meaningful input as to how this will all pan out. Will be fascinating to watch. More happy than ever with my car as it seems last of a certain era in more ways than one

[hashluck]

I was looking to buy a few AML shares as part of my ISA but they are not listed as available within my investment tool at the moment.

Does anyone know if there are restrictions on the type of share you can invest within an ISA wrapper or is it too soon after IPO for AML shares?

[hashluck]

Answering my own question

"Due to ISA and pension rules, investors will need to wait until 8am on 8 October before they can buy the shares in an ISA"

[hornbaek]

An IPO is build around a book-building exercise (so there is no true underwriting anymore). In the old days the banks would underwrite the price and hence take an exposure if it dipped below the offer price. Today they are still called underwriters but they are not underwriting anything. What happens in a bookbuilding exercise is, that up to the flotation, banks solicit offers from a large number of buyers, who in turn indicate how much they would buy at a given price within the given price range. This all happens after the roadshow where the management have a huge amount of meetings with potential investors. In the time between the last meeting and the actual floating date, the depth/quality of the book is assesed by the banks and they set the price, where they think it will accomodate all the shares on offer (with a little reserve) to guarrantee a nice and orderly price development following the IPO. The banks have the possibility to "manage" the volume during the first couple of days in order to prevent a crash (they will simply pick up shares in the market). On the other hand thay can also (if specifically mentionned in the listing document ) arrange for the sellers to increase the number of shares they are selling in order to prevent a too big increase in the share price (over-allotment option). I know I'm probably getting to technical but this is just to explain, that during the first days of trading it is very difficult to read anything into it, as the banks are still interfering. A big volume going through could hence be a bank trying to stabilise the offering. In general, a succesfull offering will show a small increase on the offer price. Clearly AML has not been that fortunate, but it hasn't been a catastrophy either. Up until now it was easy. Now the hard work for AML begins.

[ripley500]

hornbaek said:

An IPO is build around a book-building exercise (so there is no true underwriting anymore). In the old days the banks would underwrite the price and hence take an exposure if it dipped below the offer price. Today they are still called underwriters but they are not underwriting anything. What happens in a bookbuilding exercise is, that up to the flotation, banks solicit offers from a large number of buyers, who in turn indicate how much they would buy at a given price within the given price range. This all happens after the roadshow where the management have a huge amount of meetings with potential investors. In the time between the last meeting and the actual floating date, the depth/quality of the book is assesed by the banks and they set the price, where they think it will accomodate all the shares on offer (with a little reserve) to guarrantee a nice and orderly price development following the IPO. The banks have the possibility to "manage" the volume during the first couple of days in order to prevent a crash (they will simply pick up shares in the market). On the other hand thay can also (if specifically mentionned in the listing document ) arrange for the sellers to increase the number of shares they are selling in order to prevent a too big increase in the share price (over-allotment option). I know I'm probably getting to technical but this is just to explain, that during the first days of trading it is very difficult to read anything into it, as the banks are still interfering. A big volume going through could hence be a bank trying to stabilise the offering. In general, a succesfull offering will show a small increase on the offer price. Clearly AML has not been that fortunate, but it hasn't been a catastrophy either. Up until now it was easy. Now the hard work for AML begins.

Thanks for this background - very interesting to hear how it works

[Big Ry]

jonby said:

So in turn, are these limited run cars at huge margins sustainable to repeat each year or have they shot their load and will DBX/Lagonda (and in turn the Welsh factory) work. Both are million dollar (or billion dollar !) questions. As a customer, whilst some of the recently announced megabucks projects hold more passing interest than others, none are remotely possible for me as a purchase so in some ways I feel a little more distanced from AML. I get the impression some others on here do too. I also have far too little fundamental understanding of the type of people who spend £7M on DB4GTZag continuation plus a rebodied DBS to know if that kind of project is sustainable. So I really have no meaningful input as to how this will all pan out. Will be fascinating to watch. More happy than ever with my car as it seems last of a certain era in more ways than one

I have to mirror your sentiments here. If they carry on churning out multi-million pound special after special, does there not come a point when the market is so saturated with "specials", that they suddenly aren't "special" anymore ? I have no idea what goes in the head of people with the means to buy such things, but you would think that at some point those same people would say enough now.

To me the One-77 is the perfect limited run car. It's genuinely a usable car (to a point I know), but just built in very limited numbers, which gives it the appeal. Copies of originals and things being built that 99% of the time will never ever see the outside of a warm garage to me just seem a bit pointless to me. A Bugatti Chiron is special, but at least you can use it.

Even the Zagato stick has been a bit overdone of late. Look at it this way, the Vanquish Zagato has a total of 99 Coupe, 99 Volantes, 28 Speedsters and 99 Shooting Brakes, so a total of 325 cars. There are a total of 100 V12S AMR's for Coupe and Roadster combined........which suddenly means the Zagato numbers (with the exception of the Speedster) aren't that rare at all (in the context of which we're talking). Don't get me wrong, I know they're not the same etc, i'm just pointing out that I think this whole specials bullsts is getting out of hand.

I just hope now the IPO is over that AML will start to get back to the focus on consumer cars, and not just building things for the ultra wealthy that 99% of AML buyers will never even set eyes on, let alone be able to buy.

As you've said Jonby, I too am starting to feel a little distanced from AML.

Rant over

[IanV12VSRs]

Good rant Ryan and I am sure many on here share your views

[hornbaek]

Agree with the (good) rant. Its about getting the basics right and then the "specials" are the icing on the cake to maintain brand excitement. If you have more specials than basics you loose the brand identity and become irrelevant. Regarding the basics, i just read elsewhere that Porsche has sold 350.000 Mecans since the model was introduced in 2014 - that is an incredible achievement.

For AML it is now all about delivering on the promise. The basic portfolio of Vantage, DB11, DBS needs to sell well and then there i a huge leap of faith regarding the SUV. In this context the specials are irrelevant and hopefully that side of the business got pushed in order to gain media coverage leading up to the IPO as now focus has to go elsewhere.

[Jon39]

Agree with your points hornbaek.
The three present core models should be the regular main sellers. We do know that UK sales of the DB11 are trailing the DB9, and from what has been stated here, there does not appear to be a lengthy queue of existing Vantage owners, anxious to buy the new Vantage.

One interesting point with the ‘specials', is how the prices have gradually inflated.
It would appear that AML have recently discovered strengthening demand, far exceeding the limited number they choose, and with each successive model have increased the price. Don't blame them, but do you think £7 million is taking Mickey and perhaps nearing the bursting of a bubble?

The increasing demand and prices.

V12V Zagato - was that about £300,000 and did not sell the planned number?
One-77 - £1.0m, the final few were slow sellers.
Vulcan - £1.8m, the final few took a while to sell.
Valkyrie - £2.4m, could have sold over double the number.
Two Zagatos - £7.2m (that is the cost of 3 road legal Valkyries).

Edited by Jon39 on Wednesday 3rd October 21:55

[Jon39]

I have noticed a few purchases this morning, of just 4 and 5 shares.

Probably Aston Martin enthusiasts, wanting to frame a share certificate for the garage wall, and have entry to the Annual General Meetings.

[jonby]

Jon39 said:

Agree with your points hornbaek.
The three present core models should be the regular main sellers. We do know that UK sales of the DB11 are trailing the DB9, and from what has been stated here, there does not appear to be a lengthy queue of existing Vantage owners, anxious to buy the new Vantage.

One interesting point with the ‘specials', is how the prices have gradually inflated.
It would appear that AML have recently discovered strengthening demand, far exceeding the limited number they choose, and with each successive model have increased the price. Don't blame them, but do you think £7 million is taking Mickey and perhaps nearing the bursting of a bubble?

The increasing demand and prices.

V12V Zagato - was that about £300,000 and did not sell the planned number?
One-77 - £1.0m, the final few were slow sellers.
Vulcan - £1.8m, the final few took a while to sell.
Valkyrie - £2.4m, could have sold over double the number.
Two Zagatos - £7.2m (that is the cost of 3 road legal Valkyries).

Edited by Jon39 on Wednesday 3rd October 21:55

The funny thing is, the more expensive the model, the easier it seems to sell out

They sold all runs of Vanquish zagato at £650k a pop (over £1M for the speedster) far more easily than V8 AMR, ultimate vanquish and other more affordable models

I'm sure they are kicking themselves with hindsight over such a strong public commitment not to build more than 150 roadgoing valkyries

In cash terms, the 19 pairs of zagatos will generate well over £100M. The son of valkyrie £400M+. Valkyrie c £400M including the Pros. DB5 Bond over £50M. Over £15M for 14 V600s. That's one billion pounds for approx 750 vehicles

They would have to sell approx 5,000 mainstream production cars at £200k each to raise that kind of money, but in equivalent profitability terms, presumably they would have to sell more like 15,000 cars because the margins must be so much smaller on the mainstream models. You can see why they are doing it. The questions are whether it's sustainable not just because they are pushing it but also, if the general market takes a dip - V12 Zag struggled in a way that it wouldn't today primarily because market circumstances were so different

But was the market then the norm, or is now the norm ? I'm not leaning one way or the other - I have no clue. I certainly hope it works.

[Jon39]

jonby said:

The funny thing is, the more expensive the model, the easier it seems to sell out ......

But was the market then the norm, or is now the norm ? I'm not leaning one way or the other - I have no clue. I certainly hope it works.

Revenue and profit.
Only the insiders would know. AP has said the Valkyrie with high development costs may not be profitable, but will be a halo car for [the marketing of] subsequent mid-engined models.

Edited by Jon39 on Thursday 4th October 12:14

[jonby]

Jon39 said:

jonby said:

The funny thing is, the more expensive the model, the easier it seems to sell out ......

But was the market then the norm, or is now the norm ? I'm not leaning one way or the other - I have no clue. I certainly hope it works.

Revenue and profit.
Only the insiders would know. AP has said the Valkyrie with high development costs may not be profitable, but will be a halo car for [the marketing of] subsequent mid-engined models.

Edited by Jon39 on Thursday 4th October 12:14

My guess and it's nothing more, is that Valkyrie may well not make any money if looked at as an exercise in it's own right (putting to one side halo benefits) because they cannot afford to take short cuts that lead to it being anything other than a Mac F1 type once in a generation product. But that's very different to rebodying vanquish and DBS, recreating DB4, etc which are projects that must carry insane margins.

[AdamV12AMR]

jonby said:

The funny thing is, the more expensive the model, the easier it seems to sell out

Real-world Giffen goods!

[Jon39]

AdamV12AMR said:

jonby said:

The funny thing is, the more expensive the model, the easier it seems to sell out

Real-world Giffen goods!

Do you mean £7.2 million for two motor cars will appear cheap, when the next special offer is announced?

[AstonZagato]

I was chatting to an acquaintance with a fabulous Aston collection with many astonishing, rare cars. He was not looking to buy any more. Fatigue seemed to have set in. Perhaps he'll change his mind.

[George29]

Jon39 said:

Revenue and profit.
Only the insiders would know. AP has said the Valkyrie with high development costs may not be profitable, but will be a halo car for [the marketing of] subsequent mid-engined models.

Edited by Jon39 on Thursday 4th October 12:14

Could argue Valkyrie is underpriced. I’d certainly suggest it is compared to rivals. That rebodied Bugatti is around twice the price for example

[Jon39]

George29 said:

Jon39 said:

Revenue and profit.
Only the insiders would know. AP has said the Valkyrie with high development costs may not be profitable, but will be a halo car for [the marketing of] subsequent mid-engined models.

Could argue Valkyrie is underpriced. I’d certainly suggest it is compared to rivals. That rebodied Bugatti is around twice the price for example.

Good to hear from you again George.

When the pair of Zagatos were announced (£7.2m incl tax), it certainly made the Valkyrie look underpriced, or the Zagatos overpriced.

[Jon39]

Would you buy an Aston Martin again, if the Company had become a Ferrari, or Fiat subsidiary ?

http://www.providencejournal.com/entertainmentlife...

.....................................................................


Words can sometimes come back to bite.

'The British carmaker, said investors in the IPO should be prepared to pay 19 pounds a share or risk losing out on the deal, according to terms obtained by Bloomberg.' 

( The closing price on Friday was 17 pounds. - Oops! )

Edited by Jon39 on Saturday 6th October 22:36

[V12Manual]

Price again has fallen considerably this morning (more than 5%)