Shares in Newal Pocket, Japan’s little-known artificial intelligence company, have more than six times risen since it went public last month, underscoring the continued demand for technology stocks from retail investors in Japan. Neural Pocket uses artificial intelligence to analyze photos and videos.
The company’s shares rose 622 per cent in the first eight trading days of its initial public offering on the Japanese stock exchange, or August 31, making it the hottest technology stock on the Japanese stock market since 2015, according to data edited by Bloomberg. The company’s market capitalisation has so far exceeded $1 billion, as its share price has been rising. In addition, Ficha, the image recognition software developer, went public in June and has been trading at a similar price since its launch to New Pocket.
Tomoichiro Kubota, a senior market analyst at Matsui Securities, a Japanese securities firm, said the surge in Neural Pocket’s share price was supported by amateur retail investors who worked during the new crown virus epidemic, which made the Japanese stock market more active.
“The stock is becoming more and more popular among retail investors.” “Because the company’s business is related to artificial intelligence engineering, investors have high expectations for the company’s business growth,” Kubotta said. “
The Tokyo Stock Exchange’s Motors Index has soared during the outbreak and has more than doubled since its March low. Between February and April this year, more than 820,000 new personal securities trading accounts were opened in Japan, more than double the number in the same period in 2019.
While New Pocket’s current high share price is likely to remain high in the short term, “from the company’s fundamentals, it seems unlikely that this level will continue for the next two to three years,” Kubotta said. “