The first week of a company being on the ASX boards can be very telling. The market doesn't get any new information until the next quarterly or half-year result, so we can get a sense of the market sentiment from how the share does in its first week.
Of course, how the market treats a share doesn't ultimately mean anything. But, it can be interesting nonetheless.
Here are how the latest ASX shares fared:
Bounty Mining Limited (ASX: B2Y)
The company is developing the Cook North, Minyango and Wongai coking coal projects in Queensland. Cook, Cook North and Minyango are near Blackwater, whilst Wongai is located near Laura. Bounty has an agreement to acquire the underlying mining leases from Glencore over the next 18 months.
Bounty is looking to expand operations at its Cook Colliery to four underground mining areas and it's looking to produce around 2.2 Mt each year. Reviews of the locations estimate 459.8 Mt at the Cook Colliery and Cook North Project, 190 Mt at the Minyango Project and 90 Mt at the Wongai Project.
The company started trading today at 11am. Remembering that it raised $18 million of capital $0.35 per share, it is currently trading at $0.41. This means that the share price has risen by 17% on its first day.
Foolish takeaway
Initial public offerings are a great way for investors to buy into the winners of tomorrow before all the other investors pile into it.
Every current blue chip was a new share to the ASX at some stage. However, I don't believe that Bounty Mining is going to become the next BHP Billiton Limited (ASX: BHP). I'm not going to be buying any Bounty Mining shares, I'm not a fan in general of resource businesses.
