Received 50 shares in the public offering, and 63.3 on top, not a good sign.
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https://x.com/JuhaVaris/status/1907013382928027712
S-Pankkiâs portfolio manager Juha Varis comments on GRKâs IPO
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The institutional offering was multiple times oversubscribed, which is a good indication that investment professionals considered the offering favorably priced relative to the companyâs prospects.
I am pleased that, despite the oversubscription, even small investors are promised a reasonably sized position: those committed to the minimum subscription of 50 shares will receive what they requested, and others will still receive 50 shares + 63.3% of their commitment exceeding this amount. In practice, everyone will thus receive approximately 2/3 or more of the amount they subscribed for. As a point of comparison, one can take Kempowerâs offering, where, due to oversubscription, only crumbs were available for small investors, and this caused a lot of resentment at the time.
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I believe that the IPOs that occurred during the âIPO frenzyâ of 2021-22 haunt many peopleâs minds, as this period is quite recent. Almost all offerings from that time were priced according to the prevailing interest rate level, meaning they were retrospectively extremely overpriced. This was followed by the war in Ukraine and a sharp rise in interest rates, which finalized the melting away of these offerings in investorsâ hands. Now we are living in a âslump,â so the danger of overpricing offerings is probably already âparanoid,â due to the proximity of the previous âIPO hysteria.â
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Thereâs a risk of poor share price development if growth starts to stagnate. Comparable company Kreate only now reached its IPO price level after years of trading significantly below it. I typically subscribe with hundreds of thousands, but I skipped it this time, because for us buy-and-hold investors, this GRK might not offer the desired upward share price development in the longer term.
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The level of participation by international investors in the offering indicates unstable times, fueled by the war in Ukraine and Trumpâs political shifts. Infrastructure construction is largely something that must still be done for societies to be able to function. For example, Germany, which has neglected infrastructure construction, and consequentlyâŠnothing really works properly. So, institutions will probably invest in the infrastructure construction sector. Perhaps not seeking large profits, but a sure profit. And as I mentioned earlier, Kreate went public during a âboomâ time, overpriced. Now, recession pricing is on a completely different level.
Kreate wasnât expensive after all, when reading this analysis: https://www.salkunrakentaja.fi/2021/02/kreate-listautuminen-ylimerkinta/
Lower multiples than in this offering.
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Well, soon weâll see what the institutions think. Kreateâs share price has also been clearly rising recently. Indeed, the share price decline after Kreateâs offering was particularly due to factors caused by the rise in interest rates.
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69 people exited Nordnet during the first day, if my statistics are correct. Letâs see how many left today.
Initial situation: 1584 owners
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And after 2 days, 1391 owners remained, meaning 124 departed. With todayâs figures, probably at least the same amount will leave.
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As of Friday, 1357 owners remained in Nordnet.
So about 15% of owners left in 3 days. Such a sharp decline today that tomorrow weâll probably be below 1300.
Edit: Mon 7.4: 1348
Edit: Tue 8.4: 1620 
Edit: Wed 9.4: 1530
Nordea and GRK made an agreement on stabilization of 1,460,255 units in connection with the offering, but the following should be noted.
The stabilization manager has the right, but not the obligation, to implement measures during the Stabilization Period that stabilize,
maintain or otherwise affect the price of the Shares.
The Stabilization Period is 2.4 - 1.5.
GRK was moderately priced in its offering. Despite the Trump effects, infrastructure is being built according to plans, because Finland wants to remain a functional society, compared to Germany, which neglected its infrastructure and now has plenty of problems. Nordea, in its opinion, scooped up cheap shares for its funds. After all, Nordea itself had researched GRKâs value when arranging the listing, so they have a very realistic picture of the companyâs value. If the stock market turmoil continues, then precisely the basic infrastructure builders are quite stable = they are, after all, pouring concrete. However, most of the owners are likely conservative individuals in banks other than Nordnet.
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GRK doesnât seem to be under coverage by any analysis firm. Is it common for a company of this size not to have coverage, or can the start of coverage wait, for example, until the end of the stabilization period 
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Sijoittaja.fi had a relatively comprehensive analysis of GRK. 
The order book was at a record high of approximately EUR 850 million at the end of 2024. This is almost 50% more than at the end of 2023 (EUR 568 million). Significant new orders during 2024 included the Hailuoto fixed link project, the Espoo city rail contract, and several large projects in Sweden and Estonia. The high order book provides a strong foundation for revenue in 2025â2026, although ensuring project profitability will be critical.
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I came across this news in HĂ€meen Sanomat:
"A New Listed Company Gave HĂ€meenlinna a Sweet Easter Surprise â New Motorway Junction Will Be Significantly Cheaper Than Expected
The construction of an interchange from the motorway to HĂ€meenlinnaâs Moreeni business park will be clearly cheaper than anticipated. GRK Suomi oy won the construction contract tendered by the Finnish Transport Infrastructure Agency."
I get a slightly uneasy feeling when a recently listed company makes an offer significantly below budget and also below competitorsâ bids, securing the contract. It makes me think that they might just be building up their order book for the listing, and profitability will only show much later. Itâs easy to show growth figures if work is offered below market price. Or maybe GRK is just better than others at these thingsâŠ
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As a person who has tendered infrastructure projects, I would not draw more specific conclusions based on a single project.
- Project cost accounting (budget) can clearly differ from the price level of project bids. To my understanding, the number of received bids is not publicly available (a post-announcement has not been made), but it is always possible that several bids were received, and all their bid prices are below the projectâs budget.
- Regarding the project budget, it should be noted that it includes other costs besides just the contractorâs contract sum (e.g., other possible subcontracts, clientâs construction management services, clientâs own costs, etc.)
- The project budget seems to have changed significantly. In the 09/2020 plan, construction costs were 7.8/8.8 M⏠depending on the alternative (I havenât checked which one is being implemented now). In the 10/2024 plan, the cost estimate is 16.47 MâŹ. On the project pages, the cost estimate is 18.3 MâŹ. It is noteworthy, however, that the earthwork cost index has risen from that 2020 estimate.
- The deadline for the projectâs tender request was, to my understanding, at the end of February this year, which practically overlaps with the preparation for the listing (or rather, the preparation for the listing had already been done). This putting the company âin listing shapeâ has therefore already happened, if one looks at, for example, the 2024 financial figures. This tendering process is well after that.
If the tendering had taken place a year or two ago, and if we had information on the number of bids received for the project and the general cost level, then someone might start speculating about improving the figures. Now, in my opinion, it is completely unnecessary. Furthermore, I believe GRK currently has a fairly strong order book and plenty of work, so thereâs no need to scramble for these contracts âbelow market priceâ just to employ workers.
Disclaimer: I do not own GRK nor have I delved very deeply into this acquisition.
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Hurde makes a good point. I would also add that the cost estimate for an infrastructure project, used by the client as the basis for budgeting, is practically always a consulting firmâs view of the projectâs expected costs. This view can be more or less accurate. I have somewhat observed consultants having a tendency to slightly overestimate costs, because that usually leads to fewer difficulties than underestimation. However, the bidder ultimately always has the best information on the costs at which it can supply the resources needed for the project.
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GRKâs Q1 results. Strong numbers.
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Hereâs Juha Toimelaâs interview. So, over 2000% return on invested capital! 
A strong start to its stock market journey.
Topics timestamped:
00:00 Q1
02:22 Seasonality
02:50 Order book and rail projects
06:11 Expansion in Sweden
07:20 Guidance
09:09 Trade war
10:36 Strong cash position
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I first posted this concern in a different thread where the company was mentioned (the âwondering about stock pricesâ thread), but Iâm posting it here too because the concern is significant:
I donât know the company in detail and I donât own shares, but the recent growth, and especially profit growth, seems exceptionally (suspiciously?) good considering the nature of the industry and both domestic and international comparables.
The companyâs key personnel have a lot of ownership in the company, and the listing has probably created dozens of employee millionaires (who are now in a lock-up regarding their ownership).
Time will tell if they will continue to enjoy working for the company as employees and owners. The stock market has a cautionary previous example in the form of Lehto Group; that construction company listed with great hype and the share price soared, but the key personnel owners didnât stay long but left the company, sold their shares, and the whole company went under.
So, itâs a test for GRK if they donât want to be the next Lehto.
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