Shares in Operator of Tokyo’s Subways Soar in First Day of Trading

The stock price of Tokyo Metro soared 45 percent on Wednesday, the first day of trading for the company that operates a dense network of punctual and clean underground trains that traverse Japan’s capital.

Tokyo Metro raised over $2 billion earlier this month in an initial public offering, the biggest stock listing in Japan in six years. Tokyo Metro had been owned jointly by the Japanese national and Tokyo metropolitan governments.

An average of 6.5 million passengers ride Tokyo Metro’s extensive century-old underground network daily — about double the ridership of the New York City subway system.

The steady patronage from residents of the world’s largest metropolitan area has been buoyed by a surge of tourists flooding into Tokyo since Japan eased its coronavirus-related entry restrictions in 2022. A record 19.5 million international visitors poured into Tokyo last year, propelled in part by a weak yen.

Since early 2023, stocks in Japan have experienced one of their strongest rallies in decades. The Nikkei 225 index, a benchmark, is up about 14 percent this year.

The popularity of Tokyo Metro among stock traders also highlighted enthusiasm for the city’s ultraefficient and clean subway system.

While Tokyo Metro might struggle to increase its profits because of the challenge of raising prices for its many daily commuters, analysts said, investors were attracted by the company’s offer of relatively high dividends and steady cash flow. Investors also receive perks like free train tickets.

Tokyo Metro is forecasting that operating income for its transportation business will rise by about a fifth to roughly $500 million for the fiscal year ending March 2025.