Company Overview

Rivian Automotive, Inc. (RIVN) design, develop, and manufacture category defining EVs and accessories. The company markets its products directly to the customers in the consumer and commercial markets.

Initial Public Offering

The company had launched its IPO on November 10 under the ticker RIVN and had sold approximately 153 million shares at $78/share. We had covered this IPO in our ‘Kalkine IPO Report’ on November 08, 2021 and had concluded that this IPO was “Attractive” given its presence in the EV sector, aggressive growth outlook and large initials order from Amazon.

Price Chart (as on November 16, 2021). Source: REFINITIV, Analysis by Kalkine Group

Conclusion

Investors who have invested into this IPO can consider ‘Exiting’ from their position at the closing price of $172.01 as on November 16, 2021, given:

• Decent gains: The stock has moved up more than ~120% from its IPO price of $78/share.
• Valuation risk: The company is gaining a lot of traction because the market is seeing it as a good fit, pure play competitor to Tesla. However, the company is yet to report any topline number. Also, it is very unlikely to generate positive earnings in the next few years, which could lead to deterioration in the net worth of the company.
• Inflationary pressure: Auto manufacturers are witnessing a steep inflationary pressure on the back of sharp move in the underlying commodity prices. Inflationary pressure could suppress margin and extend losses for Rivian.
  

*The reference data in this report has been partly sourced from Refinitiv.

Disclaimer

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