Tokyo Metro Co. announced on Friday that the company plans to go public on the Tokyo Stock Exchange on October 23, with a valuation of approximately 639.1 billion yen.

Tokyo Metro aims to raise about 319.6 billion yen ($2.24 billion) through the IPO, which would greatly boost Japan's new stock market.

Tokyo Metro is one of the two subway operators in the Japanese capital.

Data shows that this transaction will be the largest IPO since December 2018 when SoftBank listed its mobile business subsidiary and raised $21 billion.

Tokyo Metro plans to issue 290.5 million shares, with an indicative price set at 1,100 yen per share.

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Tokyo Metro is expected to determine the IPO price range on October 7 and the stock price on October 15.

The domestic Japanese portion of the issue accounts for 80% of the volume, with the remainder targeting international investors.

Tokyo Metro expects a dividend per share of 40 yen for the fiscal year ending in March 2025, which means a yield of 3.6% based on the indicative price.

Mitsushige Akino, President of Ichiyoshi Asset Management, said the dividend yield looks "relatively high."

"This is not a stock for rapid growth, but its business performance is expected to be quite stable regardless of the economic environment."

The Japanese Ministry of Finance currently holds about 53.42% of Tokyo Metro's shares, and the Tokyo metropolitan government holds the remaining 46.58%.

The law requires the Japanese central government to sell its shares in Tokyo Metro by March 2028 to repay bonds issued after the 2011 earthquake and tsunami.

Despite recent volatility pushing the benchmark stock index into a bear market, the volume of stock issuance by Japanese companies has reached the highest level in 20 years.

According to media reports last month, chipmaker Kioxia has applied for an IPO in October.

Data shows that Japan's IPO fundraising has reached $3.3 billion so far this year.

Tokyo Metro's listing will push this figure past the $4.4 billion for the entire year of 2023.

Tokyo Metro's listing will boost Japan's IPO scale.

Also on Friday, Carlyle-backed scientific instrument company Rigaku Holdings said it is seeking to go public in Tokyo on October 25, planning to raise 109.6 billion yen.

Established in 2004, Tokyo Metro operates nine lines and transports an average of about 6.52 million passengers daily.

Nomura Securities, Mizuho Securities, and Goldman Sachs Japan are the joint global coordinators for Tokyo Metro's IPO.