By Manya Saini
Sept 21 (Reuters) - Oura kicked off the roadshow for its US initial public offering on Monday, targeting a fully-diluted valuation of $15.62 billion as the smart ring maker tests investor appetite for consumer technology companies after a tepid start to the fall IPO season.
The IPO, expected sometime next week, comes as markets have been on edge in recent weeks over uncertainty around the AI trade, rising bond yields and a shifting Federal Reserve rate outlook.
Oura and some of its existing
investors plan to raise as much as $2.2 billion through the sale of 50 million shares at the top of the indicated price range of $40 to $44.
"Oura is the first real test of US appetite after a sluggish September so far and a period of more volatile markets. If it comes strongly out the gate, it will encourage other issuers," said Samuel Kerr, global head of equity capital markets at Mergermarket.
"However, a weaker IPO might set alarm bells ringing that market sentiment may be turning."
Weight-loss drugmaker Eli Lilly has indicated interest in purchasing up to $100 million of the shares, while investment firm Dragoneer has indicated interest in buying up to $300 million worth of shares.
PRICES IN DEMAND FOR HIGH-TECH HEALTH MONITORS
Smart rings are carving out a niche between traditional fitness trackers and smartwatches, capitalizing on demand for personalized wellness insights while offering a smaller, screen-free way to monitor health round the clock with a longer battery life.
Oura has helped popularize the device, which tracks metrics such as heart health, activity and sleep.
The health-tech company sold 3.6 million Oura Rings in the 12 months ended June 30, according to its IPO prospectus. Its revenue for the nine months ended June 30 surged roughly 74% year-over-year to $1.21 billion.
The company expects to end fiscal 2026 with roughly 5.7 million paid members, representing 96% growth over the prior year.
"One of Oura's strengths is that it is beginner friendly, fashionable and feels more like an easy add-on to everyday life, compared with some wearables that are more geared toward serious athletes and performance tracking," Kat Liu, vice president at IPOX, said.
"The valuation is clearly pricing in continued strong growth and a further shift toward higher-margin recurring revenue."
The company, founded over a decade ago in Finland, reached a valuation of about $11 billion in a late-stage funding round last year.
Goldman Sachs, Morgan Stanley, and J.P. Morgan are the lead underwriters of the IPO.
The company is expected to price its IPO and begin trading on the Nasdaq under the ticker symbol "OURA" next week.
(Reporting by Manya Saini in Bengaluru; Editing by Shinjini Ganguli and Leroy Leo)
