Elon Musk’s SpaceX has completed a monumental initial public offering, raising US$75 billion ($106 billion) by selling 555.6 million at US$135 each. This staggering sum surpasses more than double what oil giant Saudi Aramco garnered in 2019 and nearly matches the combined total of the previous three largest IPOs in history. As the first “mega-cap” artificial intelligence IPO destined for Wall Street, it marks a significant moment for global markets. SpaceX is Elon Musk’s rocket, artificial intelligence, and satellite internet company, focusing on space exploration, advanced rocketry, and global satellite broadband services.
The IPO’s structure has drawn particular attention due to its unprecedented allocation to retail investors. While only 4 per cent of SpaceX shares were made public, an extraordinary 30 per cent of that tranche was earmarked for retail participants, including Australian investors via platforms like CommSec and Sharesies. Emanuel Datt, chief investment officer at Datt Capital, described this as “fairly unconventional” for a US mega-cap IPO, suggesting it could reflect “institutional distrust and cynicism” around Musk’s business models. Bell Financial Group chief financial officer Will Riggall noted this broad retail push as a “really important point for markets.”
Concerns have also been raised regarding SpaceX’s substantial valuation, estimated at roughly US$1.77 trillion ($2.5 trillion). Research house Morningstar, which published sceptical notes, indicated a valuation approaching US$2 trillion would only be justified under its most optimistic “Moonshot” scenario. This involves commercially competitive orbiting data centres and reusable Starship rockets, requiring engineering feats not expected before 2028. Morningstar assigned this scenario only a 7 per cent probability, highlighting that a 77 per cent probability would be needed to justify the US$135 offer price. Mr Datt added the company’s valuation, at “100 times sales or thereabouts,” necessitates “very, very aggressive growth assumptions.”
