Nov 1 (Reuters) - Shares of Container Store Group Inc doubled in their U.S. market debut on Friday asinvestors encouraged by a recent run of impressive "first-daypops" piled into the stock.
The company is the seventh this year whose shares havedoubled on the first day of trading, according to Jay Ritter, afinance professor at the University of Florida.
Shares of Qunar Cayman Islands Ltd, a Chinesetravel website controlled by internet giant Baidu Inc,also more than doubled in their U.S. debut on Friday.
"It is reflective of the hot IPO market at this point oftime," said John Fitzgibbon, founder of Iposcoop.com, whichtracks IPOs.
Container Store's shares, which had been priced at $18,opened at $35 and touched a high of $36.55, valuing the companyat about $1.7 billion. They were trading at $36.32 at 11.43 a.m.ET on the New York Stock Exchange.
The Coppell, Texas-based company raised $225 million afterpricing 12.5 million shares at the top end of the expectedrange.
Container Store, established in Dallas in 1978, operates 62stores in 22 states and the District of Columbia. Rivals includeWal-Mart Stores Inc, Bed Bath & Beyond Inc andprivately owned Crate & Barrel.
Container Store has two reporting units -- TCS, whichincludes retail stores, a website and a call center, and Elfa, aSwedish manufacturer of component-based shelving and drawersystems that it acquired in 1999.
"The housing market is a part of the reason that this stockis doing well," Ritter said.
"The company isn't exposed to the downward trends in thehousing market. When people don't buy bigger or better housesthey feel the need to make better use of their existing space,which benefits a company like this."
Retail stocks have outperformed the broader market so farthis year. The S&P Specialty Retail Index has risen 36 percent,compared with a 24 percent rise in the S&P 500 Index.
But Container Store has yet to post a profit, even though itachieved positive comparable-store sales growth in the 13quarters through the end of August.
Container Store's net loss narrowed to $130,000 in the yearending Aug. 25 from $30.7 million a year earlier. Net sales rose11.5 percent to $706.7 million.
Lead underwriters for the offering were J.P. Morgan,Barclays, Credit Suisse, Morgan Stanley, Merrill Lynch PierceFenner & Smith, Wells Fargo and Jefferies.
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