"Kyivstar" failed the debut trading in the U.S.. Why did its shares soar on the second day?

Shares of Ukrainian mobile operator Kyivstar went into negative territory on the first day of trading on the US Nasdaq exchange, but showed double-digit growth on the second day. The sharp reversal of quotations took place against the background of news about the peace talks, which strengthened investors' hopes for a speedy conclusion of the Russian-Ukrainian conflict.

On August 18, the second day of trading on Nasdaq, Kyivstar Group shares soared by 17%, fully compensating for the 9% drop in quotations following the results of the debut day. In the evening trading, the shares of Ukraine's largest cellular operator rose by another 8.5 percent.

According to Bloomberg, investors started buying up Kyivstar shares amid a meeting between US President Donald Trump and Ukrainian President Vladimir Zelenskyy, European leaders and NATO Secretary General Mark Rutte in Washington. Trump assessed the meeting as "very fruitful" and announced the start of preparations for Ukraine-Russia summit talks. In turn, European leaders and the Ukrainian president were satisfied with the fact that the USA expressed its readiness to participate in providing security guarantees to Kiev, Deutsche Welle reported.

"I am confident that the news that is emerging literally as I write this is largely driving market demand," Siebert Financial investment director Mark Malek wrote to clients. To maximize its growth potential, Kyivstar should focus on its fast-growing communications technology business, he said. For now, despite the Starlink contract and the digital services offered, Kyivstar remains an "old-school European telecom," Malek said.

The initial collapse of Kyivstar quotations is explained by high volatility, typical for companies on the first day of trading after going public, Forbes writes with reference to the head of Finteum's strategy department, Andrei Nesteruk. "In terms of price, the debut is not great, but far from a disaster," Nesteruk believes. - All this was happening against the backdrop of the Alaska negotiations, meaning there was a lot of politics in the price."

"Kyivstar preferred a New York listing to the London and Warsaw exchanges because it is now more important to "strengthen the connection between the United States and Ukraine rather than between Ukraine and Europe," the cellco's president, Oleksandr Komarov, told Reuters. He warned that the first weeks of trading in Kyivstar shares would be volatile, although the turbulent external environment has already been built into the company's valuation.

Investors in 2025 favored other companies associated with the prospect of an end to the military conflict in Eastern Europe, Bloomberg notes. According to the agency, the basket of European stocks formed by UBS, which can benefit from the restoration of Ukraine, has grown by 32% since January. The European stock index Stoxx 600 added 9.1% over the same period.

Activist investment fund Shah Capital, which it says will control more than 6 percent of Kyivstar, expects that "a significant portion of the frozen Russian funds will be used to rebuild Ukraine as part of the ongoing peace effort process."

This article was AI-translated and verified by a human editor