Semiconductor Materials Maker JX Advanced Metals Soar In Japan’s Biggest IPO Since 2018

Shares of JX Advanced Metals, a Japanese semiconductor materials supplier to foundries including TSMC and Intel, jumped in its trading debut on Wednesday, boasting a market cap of ¥811 billion ($5.4 billion).

The stock rose 6.6% on the first day of trading on the Tokyo stock exchange’s prime market. The IPO was priced at ¥820 ($5.54) apiece at the top end of its marketed range. JX Advanced Metals was spun off from Japanese oil giant Eneos Holdings, which raised ¥438.6 billion ($2.96 billion) from the IPO by selling a 57.6% stake in the company; Eneos retains a 42.4% stake. JX Advanced Metals did not issue new shares.

JX Advanced Metals’ IPO is the biggest in Japan since 2018, when billionaire Masayoshi Son took his telecom unit SoftBank Corp. public in a $23.5 billion IPO.

Eneos, Japan’s largest oil refiner by capacity, said it would use part of the proceeds to expand the supply of greener energy sources, including synthetic fuels and hydrogen. Eneos added that the listing would allow JX Advanced Metals to ramp up investments in semiconductor materials as well as those for the information and communications technology (ICT) sector.

JX Advanced Metals’ business spans metal smelting to producing materials for semiconductors and ICT equipment. The Tokyo-based company said it has a roughly 60% global market share of sputtering targets, which are materials used to create thin films on semiconductors for conductivity. It also claimed to have about 80% of the world’s market for rolled copper foil, which is used to make the conductive layers of flexible printed circuits, a bendable version of motherboards for electronic devices.

In the nine months ended December, the latest financial figures available, JX Advanced Metals’ revenue dropped 54% year-on-year to ¥516.9 billion while its net profit rose 10% to ¥46 billion. JX Advanced Metals attributed the revenue decline to the divestment of several copper businesses. During the same period, the company generated 43% of its sales from metal smelting and 36% from ICT equipment materials, with the rest coming from semiconductor materials.

JX Advanced Metals has been seeking to focus more on advanced materials, selling its interests in several copper mines and exiting a copper smelting joint venture with South Korea’s energy conglomerate LS Group over the past two years. Last May, the company said it plans to expand its semiconductor materials offerings, such as those for lithography, a key step in the chipmaking process where beams of lights are used to create circuitry of chips.

In the nine months ended December, its sales from ICT equipment materials climbed 34% year-on-year while its semiconductor materials business rose 23.5%. JX Advanced Metals attributed the growth to the increase in smartphone sales as well as to the AI boom that fueled demands for high-performance chips for data centers.

JX Advanced Metals is among the Japanese companies in the semiconductor supply chain capitalizing on the AI mania. Last October, Rigaku, a semiconductor testing equipment maker backed by Carlyle, went public in Tokyo in a $750 million IPO. It was followed by Bain Capital-backed memory chip maker Kioxia, which raised $800 million in its IPO in December.