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Talk about a strange time to list for online mattress company Koala Company (ASX:KOA). Not only is the company hitting the bourse in the middle of a U.S. war with Iran with a plan to expand into furniture at-home and overseas – furniture not being its main expertise – but it’s also done this during a cost-of-living crisis; likely rate hikes from major central banks, and of course, Trump’s tariff landscape.
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That war with Iran may or may not be finishing soon, to Koala’s credit, if fresh reports from the Wall Street Journal are anything to go by on Tuesday afternoon, Sydney time. (The market seems to think so: Brent Crude prices fell to ~US$108/bbl during Tuesday lunchtime trade; U.S. 10Y bond yields fell slightly.)
But then Koala Company is left to deal with the other big questions hanging over its head today: Whether or not it can immediately pivot into furniture sales as an online retailer in a way that sees the share price go up and to the right.
So far, it’s so good. While the Koala price briefly climbed +8% out the gate, it’s since pared back to around +4%. That’s pretty good for a market in crisis; those came before we had fresh reports Trump may be willing to wind down the war.
At the time of writing, KOA shares were listed at $3.40/sh earlier today and are now currently sitting at $3.55/share.
But one can’t help but notice – or this Market Link journalist can’t – liquidity is fairly subdued. Per Market Index data (which actually just rearranges Morningstar data in a more UX-friendly way) at 12pm AEDT, only $462,000 worth of shares had traded hands on Tuesday – or some 133,530 ordinary shares.
Not exactly the stuff volatility is made of. Even Australian KFC operator Collin Foods (ASX:CKF) has seen at least $1M of turnover on Tuesday, and all it did was confirm a plan to divest its Taco Bell spots Down Under.
It’s perhaps most interesting to look at depth on this most auspicious of days for Koala. At least one investor locked in a take-profit move to sell 800 shares at $6 a pop – clearly, someone was betting on the share price rocketing early.
I have a feeling they might be waiting a while. But all in all, it’s a good day when the ASX 200 welcomes a new contender – especially one with the somewhat vague prestige of Australia’s own Koala.
Fun fact: The company’s backed by cricketer Steve Smith, who was the fellow behind the 2018 ball tampering debacle. Make of that what you will, this finance journalist, for his own part, loves to see a rogue make a comeback.
And don’t worry: I’ll be watching the price in the weeks ahead, so you don’t have to.
KOA last traded at $3.55/sh.
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