The Tap30 company, a ride-hailing app in Iran, will make its stock market debut soon and would be the first startup to do so.
A press conference was held Tuesday in the run-up to IPO by Iran Fara Bourse, the junior equities market that will host the IPO.
On the company’s financial performance, CEO Milad Monshipour said the internet-based firm on average makes 360 billion rials a month and its operating income reached 2.66 trillion rials ($8.5 million) in the last fiscal year that ended in March.
“Innovative technology and artificial intelligence are the two distinctive features of the application that helped in augmenting the income,” Monshipour was quoted as saying by the IFB website.
Income comes from 15% commission on the taxi fare passengers pay to drivers. Tap30 offers cab services in 13 provinces across the country.
The CEO said it will offer 4-5% of the stake in the IPO but sell a bigger portion in the form of share premium, using the income to boost the capital of the company.
Share premium is the difference in price between the par value, or face value of shares, and the total price a company received for recently-issued shares. Share premium is the additional paid-in capital in excess of par value that an investor pays.
Most Iranian startups wanting to go public face obstacles because by nature they have dissimilar property and financial structures compared to the usual listed companies.
Stock market officials say that they have removed the barriers in the process of listing startups. The listing of Tap30 can open the door for other startups to go public.
The Iranian video on demand platform 'Filimo' and Cafe Bazaar, Iran's largest mobile app publisher, have also applied to list at stock market, according to Hamouni.
One major constraint with listing startup companies is that their assets cannot be identified and assessed exactly. Unlike other companies in the bourse that own tangible assets, startups are largely intellectual property and brand names, which cannot be easily assessed under normal valuation procedures. However, it appears that startups are gradually overcoming such hurdles.
Given the different financial structure of startups, IFB says they will be listed under “different procedures” from normal companies with clearly defined assets.
For example, startups have to offer “a big slice” of their shares as collateral with the IFB if they want to offer shares to the public. In the case of Tap30, the CEO said 50% of the shares will be collateral.
