Porsche Could Be Worth Much Less Than Volkswagen Expected

TopSpeed

By TPS Staff

Published Sep 19, 2022

Analysts estimate the value of the carmaker around 33% lower

The analysts at HSBC Holdings Plc missed a beat to the valuation of Volkswagen AG`s Porsche unit. According to their results, Porsche could be worth between $45.1 billion and $56.7 billion. This is a lot less than the $60 billion to $85 billion dollars that Volkswagen actually expected.

Why Porsche Isn't Worth As Much As Expected

In an explanatory statement, the analysts referred to the possibility of a waning pricing power of Porsche. This could happen as supply recovers over the next two years but demand may be down under a recessionary environment. The model of analysis at HSBC is thereby based on comparing Porsche to multiple companies in the same business area. According to the analysts, these were sportscar rivals like Italian carmaker Ferrari as well as German premium vehicle rivals like Mercedes-Benz or BMW.

Porsches Plans For The Stock Exchange Market In 2022

On September 6th, Porsche announced an initial public offering (IPO) to list 25 percent of preferred shares in the company on the Frankfurt Stock Exchange. This message came after months of rumors regarding Volkswagen AG preparing its Porsche unit for an IPO soon. According to Porsche, the IPO will happen at the end of September or the beginning of October and opens up a new chapter for the company with increased independence.

If the IPO happens, the Porsche family is going to buy a 25 percent blocking minority to retain control over the company. The available stock for traders will be another 25 percent of non-voting preferred shares. This means that the shareholders are going to have very limited voting rights but will in return retain a dividend on their shares.

The Future of Porsche

The IPO of Porsche is set to be one of the biggest initial public offerings ever seen in Europe and comes as Volkswagen AG has to find new ways of financing future expenses regarding its digital transformation.

For the future, Porsche wants 80% of its delivered models to be EVs by 2030. These models include the all-new Macan EV which was delayed until 2024. Furthermore, we are going to see a seven-seat SUV atop the Cayenne and a new generation of the Taycan. The Panamera on the other hand will contain ICE engines for another generation in 2023 and won´t go all-electric before 2030.