SpaceX IPO price out: Valuation, risks, growth explains — All what investors should know

Elon Musk-led SpaceX is all set for what could be the biggest initial public offering (IPO) in history, after fixing its IPO price at $135 a share and setting out plans to raise as much as $75 billion through its market debut later this month. A filing submitted to the US Securities and Exchange Commission (US SECC) on Wednesday said Space Exploration Technologies Corp. will offer 555.6 million shares, while underwriters will have the option to buy another 83.33 million shares.

If that option is fully exercised, the offering could raise about $11.2 billion in proceeds. SpaceX is targeting a Nasdaq listing on June 12 under the ticker SPCX. At the proposed price, the company would be valued at about $1.77 trillion, placing it above Tesla, which is currently worth about $1.6 trillion, and making it the seventh-largest listed company in the US by market value.

The pricing clearly reflects a premium — it's a rich multiple on current revenue, and the market is being asked to look well beyond today's numbers to the long-term potential across Starlink, launch and AI. The setup looks strong into the IPO with a thin float, real retail participation, and the Musk factor tend to drive heavy interest at listing, said Viram Shah, Founder & CEO at Vested Finance.

"Whether that's 'justified' really depends on your time horizon. Bulls will point to Starlink's growth and the scarcity value of owning commercial space at this scale; the more cautious will note the company is still loss-making and that fair-value estimates vary widely. With a low float and a wide range of views on valuation, the stock may trade with some volatility post listing, in either direction," he adds.

The valuation would also have a major impact on Musk’s wealth. Forbes currently estimates his fortune at $826 billion, including a SpaceX stake valued at $542 billion based on an earlier valuation of $1.25 trillion. A move to $1.77 trillion would add an estimated $223 billion to his net worth, potentially taking him past the $1 trillion mark. After the IPO, Musk is expected to retain more than 82 per cent of the company’s voting power.

The proposed fundraising would be well above Saudi Aramco’s record $26 billion IPO in 2019 and would also surpass Alibaba’s listing, which remains the largest IPO completed in the US market. Goldman Sachs is leading the issue, while Morgan Stanley, Bank of America, Citigroup and JPMorgan Chase are among the other underwriters.

Unlike most companies heading for an IPO, SpaceX did not begin with a price range to test investor demand. Instead, it announced a fixed share price after a series of investor meetings before the formal roadshow. The company said the $1.77 trillion valuation assumes the completion of the EchoStar spectrum and Cursor transactions.

Even as investor interest remains strong, SpaceX is still loss-making. Regulatory filings show it reported an operating loss of $2.6 billion last year on revenue of $18.7 billion, and losses have continued this year as the business expands. The company said it plans to use the IPO proceeds to scale its artificial intelligence and space businesses, expand infrastructure, and strengthen the satellite network that supports its Starlink Mobile service.

Its core business remains centred on Starlink and launch services, while the xAI acquisition has added another revenue stream to its filings. According to The Wall Street Journal, investor demand is likely to depend on whether buyers believe Musk can deliver on projects such as Mars colonisation and space-based data centres.

SpaceX IPO a major test of global risk appetite for futuristic, founder-led businesses at extreme scale. The offering is being priced as a platform for the next decade of space, satellite broadband, defence technology, and AI-led infrastructure. That is where the excitement lies, but also where the valuation risk begins, said Harshal Dasani, Business Head at INVasset PMS.

"The listing can still receive strong demand because scarcity, brand strength, retail participation, and Elon Musk’s ecosystem premium are powerful forces. But from a disciplined investor’s lens, the key question is not whether SpaceX is an exceptional company. The real question is whether the IPO price leaves enough margin of safety for public-market investors," he said.

The filing also showed deeper links across Musk’s companies. SpaceX said its AI unit, xAI, bought $269 million worth of Tesla Megapack battery systems in April, after Tesla earlier reported selling $430 million worth of Megapacks to xAI during the previous year. Musk combined SpaceX and xAI earlier this year in a deal that valued the merged entity at $1.25 trillion.

Tesla also holds 18.99 million SpaceX shares, worth about $2.56 billion at the IPO price. SpaceX first disclosed its IPO plans in a prospectus filed late last month, and an amended filing this week said up to 5 per cent of the IPO shares could be reserved for selected employees and other eligible participants under a direct share programme. 

As the June 12 listing approaches, the IPO brings together a fixed issue price, a $1.77 trillion valuation, continuing losses and a business built on Starlink, launch services and newer AI-related operations.