Whalesbook
SpaceX began trading on the Nasdaq today at $135 per share. With a valuation estimated near $1.75 trillion and a recent annual loss of $4.94 billion, the stock is a high-growth play. Indian investors can access shares through international brokerages, but experts highlight risks related to high valuations, the limited number of shares available to the public, and delays in major index inclusion.
What Happened
SpaceX, the space exploration company led by Elon Musk, has officially begun trading on the Nasdaq stock exchange. The shares started their journey on the public market at $135 each. While the company is well-known for its aerospace work, its transition to a publicly traded entity brings new dynamics that shareholders must understand.
The Valuation and Financial Context
The company enters the market with a valuation estimated by some at $1.75 trillion. To understand the financial picture, investors should look at the 2025 performance data. The company reported revenue of $18.67 billion, marking a 33% increase over the previous year. However, it also reported a net loss of $4.94 billion. This indicates that while the company is growing its sales, it is still spending more money than it earns. For investors, this creates a situation where the stock price reflects future expectations rather than current profitability.
Why Index Inclusion Matters
One major factor for long-term stock stability is inclusion in major indices like the S&P 500 or the Nasdaq 100. When a company joins these indices, passive funds—which are funds that automatically track these indices—must buy the stock, often providing consistent demand. However, SpaceX is not expected to join these indices immediately. For instance, the S&P 500 requires companies to be profitable and listed for at least 12 months. Since SpaceX is currently reporting losses, it may face a long wait before it qualifies for inclusion in these major baskets.
The Liquidity Risk
Only about 3% of SpaceX shares are being offered to the public in this listing. A low percentage of shares available for trading, often called a low float, can lead to higher price volatility. Because there are fewer shares changing hands, even small buying or selling activity can cause large swings in the stock price. Investors should be aware that this could result in a bumpy ride for the stock in the initial days of trading.
How Indian Investors Can Participate
Indian investors generally cannot participate in US Initial Public Offerings (IPOs) directly. However, they can buy shares once the stock begins trading on the exchange. This is possible through international brokerage platforms that operate under the Liberalised Remittance Scheme (LRS). While some international mutual funds also provide exposure to US markets, they are subject to strict limits set by the Reserve Bank of India and SEBI, with a specific cap on how much capital each fund house can allocate to foreign stocks. This limits the total amount of exposure these funds can provide.
What Investors Should Track Next
Investors should monitor a few key areas moving forward. First, they should watch the company’s path toward profitability, as narrowing the $4.94 billion loss will be crucial for long-term valuation support. Second, tracking the price discovery process is important, as the initial listing price may shift significantly once trading volume stabilizes. Finally, management updates regarding future project timelines and capital spending will be essential to understanding whether the company can maintain its 33% revenue growth while managing its debt and cash flow requirements.