Nextracker, a solar technology company based in Fremont, California, has priced its initial public offering (IPO) higher than its expected range of $20 to $23 per share, according to sources familiar with the transaction. These sources, who chose to remain anonymous while discussing the process, reported that the order book for the company was “well subscribed” and that demand allowed Nextracker to exceed its pricing expectations.

The initial public offering of Nextracker is expected to generate roughly $638 million, as the company plans to sell 26.6 million shares at a price of $24 each. This exceeds the upper limit of $535 million that the company had previously stated in a filing. The outcome is also prior to the so-called greenshoe option, which gives the bankers the ability to sell additional shares, according to sources familiar with the matter.

The successful pricing of Nextracker’s IPO is seen as a positive indication for the IPO market, which has been struggling in recent times. Last year, the proceeds from public listings dropped by 94% following the Federal Reserve’s aggressive rate-increase campaign. Many unprofitable tech companies, particularly those who went public in 2020 and 2021, saw a decline in investor interest.

According to sources, the Nextracker IPO is considered to be the first significant public listing of the year, as it is expected to be the largest U.S. IPO since Mobileye, an autonomous driving company, raised $990 million in October. The bookrunners of the IPO were able to secure anchor investments from BlackRock and Norges Bank Investment Management, which helped increase the demand for shares.

Nextracker is set to start trading on the Nasdaq exchange on Thursday morning, under the ticker symbol NXT, as reported by a source. The company, previously a subsidiary of manufacturer Flex, offers hardware and software that allows solar panels to track the movement of the sun, thereby enhancing the efficiency of solar power plants.