SpaceX set a new record for the world's largest IPO, triggering unprecedented investor demand: retail investors placed orders exceeding USD 100 billion, with some even selling technology stocks to raise funds; BlackRock led investments exceeding USD 5 billion, while Middle Eastern sovereign wealth funds and family offices entered the fray, with Saudi Arabia’s and Kuwait’s sovereign wealth funds submitting orders ranging from USD 1 billion to USD 5 billion. Asian investors unable to participate directly sought alternative exposure through supply chain-related equities and ETFs.
$SpaceX (SPCX.US)$ The largest IPO in history has triggered an unprecedented subscription frenzy across global capital markets.
Retail investor subscriptions exceeded USD 100 billion, BlackRock placed a single order surpassing USD 5 billion, and major Middle Eastern sovereign wealth funds and family offices all participated. Asian investors excluded from direct participation have instead sought alternative exposure through supply chain equities, thematic ETFs, and Nasdaq index funds.
On June 11, according to The Wall Street Journal, SpaceX confirmed on Thursday that it had completed the sale of all 555.6 million shares at a fixed price of USD 135 per share, raising approximately USD 75 billion and valuing the company at roughly USD 1.77 trillion. This would surpass the previous record of USD 29.4 billion set by Saudi Aramco in 2019, making it the largest IPO in history.
Meanwhile, underwriters have been granted a 30-day greenshoe option to purchase an additional 83.33 million Class A common shares at the offering price. The IPO was led by Goldman Sachs, Morgan Stanley, Bank of America, Citi, and JPMorgan, with shares scheduled to begin trading on Nasdaq on June 12, Eastern Time.
Demand for this offering far exceeded supply. According to sources familiar with the matter, retail investor subscriptions alone significantly surpassed USD 70 billion and ultimately broke through USD 100 billion. Additionally, around 1,000 institutional investors submitted orders, leaving total demand vastly ahead of the offering size.
In order to raise cash for participation in this IPO, retail investors have been net sellers of individual stocks for three consecutive trading days, with semiconductor and AI-related stocks hit hardest—Micron, Qualcomm, and Broadcom all came under pressure in succession.
Led by BlackRock, Institutional Orders Were 'Staggering in Scale'
According to reports, BlackRock, the world’s largest asset manager, has submitted a subscription order of at least USD 5 billion for the SpaceX IPO, making it one of the largest institutional investors in this offering.
The report noted that other large asset management firms also submitted orders 'equally astonishing' in scale—a level rarely seen in traditional IPOs. For context, the largest IPO earlier this year was that of a chip company $Cerebras Systems (CBRS.US)$ , whose total offering size was only USD 5.55 billion.
According to an article by Wall Street Journal cited by Caixin, sovereign wealth funds, in addition to large mutual funds and pension funds, are also actively participating.
The article stated, citing people familiar with the matter as reported by Bloomberg, that Saudi Arabia’s Public Investment Fund (PIF) and Kuwait Investment Authority (KIA) have each submitted subscription orders ranging from $1 billion to $5 billion, and Qatar Investment Authority (QIA) may also make a significant commitment.
Additionally, according to The Wall Street Journal, a single-family office investor has submitted a subscription request exceeding $1 billion.
Market participants noted that the concentrated inflow of such long-term capital carries special significance. Unlike hedge funds that chase short-term trading opportunities, asset managers, pension funds, and sovereign wealth funds tend to focus on growth prospects over the next decade or even several decades. Their large-scale participation is viewed as a strong endorsement of SpaceX’s long-term value.
Middle Eastern Sovereign Wealth Funds: A Value Realization Milestone with Sustained Investment Enthusiasm
As noted in an article by Caixin, Middle Eastern sovereign wealth funds’ bets on SpaceX are not accidental but rather a continuation of their years-long, deep strategic positioning within Elon Musk’s ecosystem.
PIF’s AI investment platform, Humain, has already invested $3 billion in xAI this year, and this equity stake will be converted into SpaceX shares; PIF also holds indirect exposure to SpaceX through Kingdom Holding.
Abu Dhabi’s sovereign fund MGX holds stakes in Anthropic, OpenAI, and xAI, achieving full coverage across the three most prominent AI companies. QIA has already invested in both Anthropic and xAI.
For these sovereign wealth funds, this IPO marks the first genuine value realization milestone following years of investments across the AI value chain.
Despite ongoing regional conflicts involving Iran’s attacks on Gulf states, these sovereign funds have not halted their deployment efforts. The Iran conflict could impede domestic AI development initiatives in Gulf countries, potentially further strengthening their motivation to allocate capital to high-quality overseas assets.
Several of Musk’s companies have also deeply penetrated the Middle East: The Boring Company will construct Dubai’s underground loop, Emirates is upgrading its in-flight Wi-Fi using Starlink, and Neuralink plans to launch clinical trials for brain-computer interfaces in Abu Dhabi.
Retail investor subscriptions have exceeded $100 billion, prompting massive sell-offs of tech stocks to secure capital for allocation.
Meanwhile, as Wall Street Journal noted in its article, retail investor enthusiasm has been particularly pronounced. Retail orders exceeding $100 billion far surpass the maximum allocation they could receive—even assuming a 20% allocation ratio against a $75 billion offering size, the vast majority of retail demand would still go unfulfilled.
According to Bloomberg, retail investors are expected to receive at least 20% of the shares available for sale. CNBC, citing informed sources, reported that SpaceX plans to allocate slightly more than 20% to retail investors, including international individual investors, online brokerage clients, and private banking clients—a proportion lower than the approximately 30% previously anticipated by Musk.
To raise funds for participation in the offering, retail investors have recorded net sales of individual stocks for three consecutive trading days—the first such occurrence since March 2020. Vanda Research data shows that selling was concentrated in semiconductor and recent AI-related stocks—Micron ranked among the worst performers in the S&P 500 during Tuesday’s tech selloff, Qualcomm fell another 6.9% on Wednesday, and Broadcom declined by 5.1%.
Viraj Patel, Global Macro Strategist at Vanda Research, stated: "Current evidence suggests retail investors may be stockpiling cash in anticipation of the upcoming IPO. Certain factors are causing them to hold back." Greg Boutle, Head of U.S. Equity Derivatives Strategy at BNP Paribas, also noted that Micron’s decline may reflect retail investors 'selling recent winners and leveraged products' to invest in SpaceX.
BNP Paribas analyst James Picariello estimates that retail investors hold approximately 40% of Tesla shares, underscoring this group’s strong affinity for Musk-affiliated companies. Fidelity has further lowered its client participation threshold to just a $2,000 account balance.
Asian investors pursue alternative routes, turning to supply chain stocks and ETFs as substitutes
According to Bloomberg, most Asian investors have been excluded from this IPO, compelling them to seek creative alternatives. In the Asia-Pacific region, only retail investors in Japan and Australia can directly participate in the offering, with Japan’s allocation having been increased earlier this month from $2 billion to $2.5 billion.
In South Korea, some investors sought access through private placement channels offered by local brokerage Mirae Asset Securities, with related allocations reportedly selling out within one minute, according to Yonhap Infomax.
For investors unable to participate directly, shares of companies in SpaceX’s supply chain have become the most sought-after alternative. According to Bloomberg, Sunway Communication, a Chinese company supplying ground terminal components for Starlink, has surged 60% year-to-date, while Lens Technology has risen 41%—both significantly outperforming the CSI 300 Index, which is up just 2%.
In Taiwan, satellite and communications suppliers have also seen sharp gains: WNC Corp jumped 175%, Chin-Poon Industrial rose 91%, and Universal Microwave Technology soared 147%. All three companies confirmed they supply components to SpaceX, and their gains have even outpaced Taiwan’s benchmark Taiex Index—one of the world’s best-performing indices this year, up 49%.
ETFs are also gaining popularity. According to reports, the ARK Space and Defense Innovation ETF is on track to record net inflows of at least $200 million for the second consecutive quarter—the first time this has occurred in five years.
Additionally, some investors are positioning themselves through Nasdaq-100 index-tracking funds, betting that SpaceX will swiftly become a significant component of major technology indices following its listing, given its substantial market capitalization. Reports indicate that SpaceX could be eligible for inclusion in the Nasdaq-100 Index as early as 15 trading days after its Nasdaq debut, provided it meets the requisite size, liquidity, and eligibility criteria.
Louis Wong, Director at Hong Kong-based Phillip Securities, stated:
"Our advice to clients centers on two strategic approaches: direct participation in the secondary market and accumulating existing fund structures that hold early-stage private equity allocations."
Valuation Rationale Coexists with Market Risks
Despite robust demand, several risk factors surrounding this IPO warrant attention.
According to The Wall Street Journal, SpaceX is not yet profitable, and its valuation of approximately $1.77 trillion is largely predicated on the prospects of its emerging artificial intelligence division.
Musk has adopted a 'take-it-or-leave-it' fixed pricing approach, abandoning the traditional IPO book-building mechanism, and will retain unprecedented control over the company—a structure that has drawn criticism from corporate governance advocates.
In addition, Wall Street News also noted in the article that analysts have warned that market pressures could persist as initial public offering (IPO) plans by AI companies such as OpenAI and Anthropic move forward, coupled with large-scale stock sales by existing technology firms.
Gil Luria, head of technical research at DA Davidson & Co., said in a Bloomberg Television interview:
"Investors will need to free up capital from all their public market positions—particularly in tech stocks, including the largest by market cap—to fund these IPOs."
Douglas Beath, global equity strategist at Wells Fargo & Co.'s Investment Institute, stated that retail investors’ selling ahead of IPOs is unlikely to trigger a sustained decline in U.S. equities. However, U.S. households’ equity holdings as a share of total financial assets have neared a record high of 35%, and amateur investors may "sell existing positions to fund new allocations," potentially causing "some degree of indigestion in the market."
Editor/KOKO