Chapter 665: A First-Day Miracle

From the moment Simon and his wife arrived at the New York Stock Exchange headquarters at 7 a.m., the atmosphere inside and outside the historic building became increasingly vibrant as more guests arrived. Not only were key executives from Daenerys Entertainment Group, such as Amy Pascal and Robert Iger, present, but also numerous top executives from other branches of the Westeros system, including Egret Corporation, Cersei Capital, and Verizon Communications. The presence of numerous movie stars, pop singers, and supermodels—invited to witness the event—gave the NYSE, usually populated by financial professionals, a glittering star-studded ambiance.

Egret Portal livestreamed today's listing ceremony.

By 9 a.m., the global viewership of the IPO live broadcast had exceeded 26 million people.

"Highly anticipated" hardly did justice to the scene.

At 9:15 a.m., the core leadership team of Daenerys Entertainment, who had been taking turns in media interviews, began to gather on the bell-ringing stage. Daenerys Entertainment CEO Amy Pascal delivered the listing speech on behalf of the company.

This task would typically have been Simon's responsibility. However, Simon maintained a low-profile public strategy, even if his strength didn't permit it, avoiding public appearances whenever possible.

In fact, Simon originally wanted to hand over his role as chairman of Daenerys Entertainment Group to Amy Pascal. Doing so would have opened up a promotion path for many. However, when the idea was proposed, the entire management team of Daenerys Entertainment opposed it. Although everyone knew Simon wouldn't abandon the company's affairs, public investors might not see it that way. As the Westeros system grew larger, investors might think Simon intended to step away from managing Daenerys Entertainment entirely, which could impact the company's post-listing market confidence.

Being fundamentally focused on long-term investment, Simon didn't care much about short-term stock price fluctuations of companies within the Westeros system, but he had to consider the interests of many others.

At 9:30 a.m., the NYSE opened.

Under the watchful eyes of millions through live TV, internet streaming, and on the trading floor, Simon and his wife, along with Amy Pascal, Robert Iger, and other key executives, pressed the button that officially marked the start of Daenerys Entertainment Group's stock trading, completing the bell-ringing ceremony.

However, for most who were following the event, the excitement was just beginning.

After the bell-ringing ceremony, an IPO company's stock doesn't immediately start trading freely on the secondary market. It enters a pricing phase where investors from around the world make bids to determine a reasonable opening price based on actual market demand, preventing system congestion from a flood of buy orders at the start of trading.

Typically, a company IPO goes through two to three rounds of bidding, with official trading usually beginning before 10:30 a.m. after a 9:30 a.m. market open.

After the ceremony, Simon and his wife, Westeros system executives, media reporters, and many guests did not rush to leave. With just an hour of bidding, patience was in ample supply as everyone wanted to witness the opening price of Daenerys Entertainment, which had an IPO valuation of $53.1 billion.

Feedback from IPO roadshows, media reviews, and other sources indicated that Daenerys Entertainment's stock price would likely rise above the issue price on the first day. However, predictions varied widely on how high the stock would go on the first trading day.

Conservatives believed Daenerys Entertainment Group's market cap would close between $60 billion and $70 billion on its first day, already a top-tier valuation in the U.S.

Some believed Daenerys Entertainment could surpass General Electric's leading market cap position in the U.S. on its opening day.

As of the previous day's close, GE's stock price had reached a new high of $81.7 billion, boosted by the U.S. economic recovery.

For Daenerys Entertainment's market cap to surpass GE on its listing day, the stock price needed to rise 53%, which, given recent investor enthusiasm, wasn't seen as overly challenging.

The most optimistic outlook even suggested Daenerys Entertainment could break the $100 billion market cap barrier on its first day, becoming the first U.S. company to achieve such a valuation.

This wasn't baseless speculation.

According to Daenerys Entertainment's Q1 1994 financial report, from January to March, the company reported $5.627 billion in revenue, a 37% increase year-over-year, and a net profit of $653 million, a 16% increase.

Based on this report, Daenerys Entertainment's annual revenue was conservatively estimated to reach around $22.5 billion in 1994, with net profits not falling below $2.6 billion.

Thus, even if Daenerys Entertainment's market cap surpassed $100 billion on the first day, it would only represent a price-to-earnings ratio of 38.

In the U.S. stock market, companies with P/E ratios near 40 were common, especially for a supergiant like Daenerys Entertainment, which dominated Hollywood.

The first round of bidding took longer than expected.

At 10 a.m., the NYSE trading floor's electronic display finally showed the results of the first round of bidding: a price range of $24.75 to $25.25 per share.

Compared to the $22.5 issue price, this was a 10% increase.

Inside and outside the exchange, many calculated that if the stock price rose similarly over three rounds of bidding, it might see a 30% increase at the opening, pushing the market cap past $70 billion.

However, the developments exceeded everyone's expectations.

After the second and third rounds of bidding at 10:15 and 10:30 a.m., the price range rose to $27.5 to $28.5 per share. A roughly 24% increase over three rounds of bidding fell slightly below some expectations, but the exchange soon reported continued active investor interest. This meant the bidding wasn't over, and the process would continue.

Many guests, who had planned to leave after the stock opened, realized they had spent an extra hour waiting without noticing.

Everyone chose to stay and continue watching.

Egret Portal's live viewership, far from declining after the bell-ringing, continued to grow. By around 10:30 a.m., the audience had surpassed 31 million.

Bidding continued.

Fourth round: $30.25 - $30.75.

Fifth round: $31.5 - $32.25.

Sixth round: $32.75 - $33.25.

Seventh round: $33.75 - $34.75.

Eighth round: $35.25 - $35.75.

In 1994, even as electronic trading expanded, stock quotes still used an eighth of a dollar as a fixed unit to reduce the data load during transactions, meaning the minimum price change was $0.125.

Finally, at 11:45 a.m., the unexpected waiting time of over an hour culminated in the eighth and final round of bidding results. The excitement had become so intense that many felt numb.

U.S. stock markets don't close at noon.

At 12 p.m., the NYSE announced that Daenerys Entertainment's stock would open at $35.5 per share.

At this point, Daenerys Entertainment's stock price had increased by 57% from the issue price, with a market cap of $83.3 billion, overtaking General Electric to become the most valuable publicly traded company in the U.S.

GE's record was easily broken; could $100 billion be far off?

With this question and a sense of odd anticipation, countless eyes remained fixed on Daenerys Entertainment's stock as trading officially began.

Simon and his wife had expected to leave the NYSE around 10:30 a.m. but ended up staying until noon. A lunch reception was arranged at the Hilton Hotel near the NYSE to entertain the guests and media present. Due to the delay, everyone arrived at the hotel around 12:30 p.m., an hour later than planned.

However, no one minded these details.

Even at the hotel, the main topic of conversation was the likely closing price of Daenerys Entertainment's stock. Some guests snuck away during the reception to take a call or two.

After a late night and an early morning start, followed by an exciting morning, Janet skipped the reception and returned to their Fifth Avenue apartment for a beauty nap.

Simon couldn't afford to leave and headed to the Hilton alone.

"Our market analysis team gathered the first batch of audience surveys from the East Coast this morning. The feedback on *Forrest Gump* is very positive; people find it very interesting and worth watching. More than half of the viewers said they would recommend it to others. While the final results will be out tonight, this is already a good sign that the film's box office should not be bad."

In the banquet hall.

Having discussed the IPO extensively, Simon and Amy turned their conversation to *Forrest Gump*, which officially opened widely today.

Everyone understood that the success or failure of *Forrest Gump*, coinciding with the IPO, would significantly impact Daenerys Entertainment's stock performance in the coming period.

Now that the company was listed, even though Simon, through a dual-class share structure, still had absolute control over Daenerys Entertainment, certain things had to be done according to the rules. Protecting the company's stock price was something both shareholders and management had to strive for.

To achieve a word-of-mouth phenomenon, the most crucial metric in audience feedback was the percentage of viewers who would recommend the film to others, which had to exceed half.

Although Amy's outlook remained conservative, the morning's survey showed this index had reached the standard.

Simon felt reassured and said, "We can start discussing additional promotional budget now.

 Instruct the team this afternoon to add another $10 million."

Amy thought for a moment and nodded, then added, "I'll distribute this budget across other films."

Distributing losses across budgets is a common practice among film companies to gloss over financial reports.

Before the IPO, Daenerys Entertainment didn't engage in such practices because it wasn't necessary. Simon also demanded that management provide 100% accurate financial data.

Now that they were a public company, certain special financial measures had to be adopted at times.

"Too clear water has no fish."

Simon didn't object to necessary concealment practices by a company. However, he objected this time: "No need, just account it under *Forrest Gump*. Amy, the efficient management system of Daenerys Entertainment has been hard-earned over the years. I don't want Daenerys Entertainment to make unnecessary changes just to conform to market rules. Sometimes, once you lose something, it can be very hard to regain."

Feeling the seriousness in her boss's gaze, Amy nodded solemnly.

They continued chatting for a while until Verizon CEO Raymond Smith came over to greet them, prompting Amy to excuse herself.

After being absorbed into the Westeros system, Verizon had been focusing on expanding its mobile communications and overseas markets.

Now, both areas had reached considerable scale. To progress further, Verizon had to wait for further deregulation of U.S. telecommunications.

The Westeros system had initially been making good progress pushing telecom reform legislation, but recent interference from the Hearst family disrupted Daenerys Entertainment's lobbying efforts, drawing widespread attention from many midterm election candidates. The situation would likely see no progress in the short term.

Raymond Smith could only envy America Online.

This internet service provider, exploiting loopholes in U.S. telecom laws through the emerging internet industry, wasn't restricted to operating in just a few states like Verizon. They could expand their services nationwide.

Although AOL's pure internet access services paled compared to Verizon's investments in infrastructure, should telecom regulations loosen, AOL could easily extend its business into cable TV and fixed-line phone services, posing a serious challenge to traditional cable and phone operators.

In theory, traditional telecom companies should oppose deregulation.

In reality, the opposite was true.

Regional telecom companies like Verizon harbored ambitions to expand nationwide. To do so, even knowing that deregulation would give AOL a massive advantage, they had to push for federal telecom law reforms. Otherwise, they risked slowly withering away in their limited territories.

Through AOL, the Westeros system had already laid potential foundations in internet services, cable TV, and fixed-line telephony. Raymond Smith understood that Simon would not support another similar telecom giant, nor would the U.S. government allow it. Therefore, Verizon had to focus on the burgeoning mobile communications sector.

Given the rapid growth in the mobile communications industry over recent years, Raymond Smith predicted that this sector's future market size would rival traditional telecommunications.

As the luncheon continued at the Hilton Hotel, Daenerys Entertainment's stock price soared after the official opening, showing no signs of slowing down.

The high opening price did not dampen trading enthusiasm; instead, it further spurred global investors' buying interest.

By around 1:30 p.m., an hour and a half after the official opening, the NYSE delivered exhilarating news: Daenerys Entertainment's stock price had risen 88%, reaching $42.375. With a total of 2.363 billion shares, the company's market cap officially broke the $100 billion mark.

But the miracle didn't stop there.

After surpassing the $100 billion market cap, Daenerys Entertainment's stock price experienced some volatility but continued its upward trend.

At 3:46 p.m., amidst the fluctuations, Daenerys Entertainment's stock price broke through the $45 mark, achieving a 100% increase from the IPO price.

Then, in the last 40 minutes of trading for the week, trading activity intensified even further.

Finally, at 4:30 p.m., the U.S. stock market closed with Daenerys Entertainment's stock price at $47.75. This represented a 112% increase from the IPO price, bringing the closing market cap to an astonishing $112.8 billion, an unstoppable force!

_________________________

[Check out my Patreon for +200 additional chapters in all my fanfics! $5 for all!!] 

[w w w . p a t r e o n .com / INNIT]

[+50 PowerStones = +1 Chapter]