After a booming year in 2021 which saw more than 180 companies join the ASX boards, investors are still on the lookout for IPO opportunities which offer the potential for outsized returns once private companies access public capital markets.

In this analysis, Trent Primmer – corporate advisor and head of trading at Barclay Pearce Capital – highlights three pre-IPO companies that BPC has been working with in an advisory capacity ahead of their public listing.

With two ASX listings and one Nasdaq listing, the companies give exposure to broader trends in high growth sectors – renewable energy technology, and fintech/ecommerce.

Along with detailing what each company does along with their value proposition, Primmer also provides unique insights into what the Barclay Pearce Capital team learned in the advisory process.

Three IPOs to watch

Synergen Met (ASX:SH2)

Synergen has been involved with developing and working with plasma technology for over 14 years.

The company uses thermal plasma as a core enabler of applications that reduce harmful carbon emissions and detoxify industries.

How does the process work? Using Synergen’s intellectual property and expertise, plasma is generated when gases are heated to extremely high temperatures to form ionised gas.

Molecules are broken down to their base elements, which retain useful compounds and destroy unwanted or harmful compounds.

The business is at a stage where it’s raising capital to develop its two current applications using its plasma technology:

1. Hydrogen production from methane through pyrolysis and filtration, and;
2. The breakdown of PFAS (toxic chemicals that can be found in drinking water) through its subsidiary Treata Environmental.

“We believe the applications for this are colossal, and there is an incredibly lucrative target market for the company’s core business,” Primmer says.

He highlighted that SH2 is operating in a sector with strong tailwinds from the ESG policy shift.

“There’s renewed enthusiasm to reduce harmful emissions and the large amounts of capital being thrown at renewable and environmentally friendly businesses,” Primmer said.

“So we expect this company to be well supported at IPO and to flourish long term.”

With operations in both Australia and the US, Synergen has established itself as a first-mover in what will be large global growth markets.

The company is looking to list around March, and will be undertaking a $20-25m placement with a valuation at IPO of around $120-125m.

“If you’re looking for an opportunity to ride the renewable energy wave, we think it’s hard to look past Synergen – they have an all-star team and a very exciting future,” Primmer said.

MyRewards (ASX:MRI)

Another pre-IPO company in the Barclay Pearce Capital stable is MyRewards – a leading Australian-based loyalty and rewards platform which is looking to scale up into global markets.

“MyRewards is a really interesting one. Beyond the incredible marketing they have done for their product, this is a business that is fundamentally strong and relatively cheap on a PE (price-earnings) basis compared to peers,” Primmer said.

He added that MRI is an “extremely fast-growing global provider of rewards, recognition and loyalty programs targeted at corporate customers and consumers”.

“There is a huge amount of growth in this sector. Since its launch more than 20 years ago, the business has grown to serve more than 4.6 million members, with over 4,500 global, national and local suppliers,” he said.

Some of the Australian corporate clients include telco giant Telstra, Ramsay Health Care, MLC and AIG.

“We like this business because, as I mentioned it does look cheap compared to peers and has an exceptional growth trajectory, with ambitions to grow to over 30 million members and over 26 countries,” Primmer said.

He added that in working with the company, the Barclay Pearce Capital team has spent a lot of time with the executive team – CEO Maitreyee Khire and Chairman David Vinson – and their passion to build MyRewards is “really infectious”.

“It’s pretty refreshing to see a board that’s so hands on with their company so it’s kind of hard not to get excited about how they’ll drive growth post-IPO,” he said.

“The business is aiming to list at 20c a share on the 11th of February, and we’re really eager to see how it performs.”
“The pre-IPO round was very popular with investors, and we think this business at that IPO price is a no-brainer and looks excellent long term,” Primmer said.

Verdant Earth Technologies (NSDQ:VDNT)

For Primmer, Verdant hits “pretty close to home”, as it was one of the first deals he worked on at Barclay Pearce Capital.

“Watching how hard everyone has worked on growing this business from both a company level, as well as the corporate advisory team, remains in my memory as something extremely impressive,” he said.

In Primmer’s view, Verdant has a particularly exciting growth path ahead as it aims to establish its core operating target – a recommissioning of the Redbank power station in NSW as a net-zero facility.

Once completed, Redbank will use waste wood residues sourced from sustainable forestry waste and/or sustainable timber waste to generate power.

“Its core business utilises biomass feedstock to generate 1,000,000 MWh of green baseload power, which is the equivalent of powering 200,000 homes,” Primmer said.

The business also intends to deliver end-to-end hydrogen solutions facilitating the advent of a hydrogen powered economy.

Working with Verdant has been “a highlight for our corporate advisory team, and the excitement from clients has been pretty unreal”, Primmer said.

“That’s not just from an expected return perspective, but the fact that they will have been part of something that is potentially game changing in how economies are powered, and could make history as potentially one of the first successful movers in the renewable energy space in Australia,” Primmer said.

The business has emerged from humble beginnings, after initially kicking off pre-IPO rounds at around 10-16c a share at an EV of around $30m.

Now, it’s set to access one of the deepest capital markets in the world, as a listed green energy producer on the Nasdaq with a current funding round of US$25-$50m at between US$7-US$9 a share.

“The company is expected to list in the coming weeks, and I think it will have a strong debut – particularly give that the NASDAQ has stabilised in earnings season,” Primmer said.

At Stockhead, we tell it like it is. While MyRewards is a Stockhead advertiser, it did not sponsor this article.