Ocado denies it needs more cash after stock market debut

Online grocer Ocado's chief executive Tom Steiner has rubbished talk the company still needs more cash after the loss-making company slashed the offer price for its IPO at the last minute.

'We are not anticipating any further equity funding requirements in the medium term,' he told journalists.

A number of analysts have warned the money raised from the stock market flotation would be insufficient. One of them, Dave McCarthy at Evolution, said: 'The business needs more capital invested before it stands a chance of breaking even.'

Steiner dismissed the claim saying: 'That's rubbish. I am sure we have sufficient cash flow to grow the business very, very substantially from where we are today.'

Shares in Ocado fell nearly 14% to 155p in the first day of conditional trading as a number of investors shorted the stock.

At that level the shares are trading nearly 45% lower than the upper end of the 200-275p range first suggested for the flotation. Steiner said he was not worried.

'We'll see where it will be in two years time. I am quite confident that it will be significantly above the range we went out with,' Steiner said, adding he would not sell his own shares at 275p.

Steiner lashed out at the many analysts who had said the original price-tag was too high.

'Any self-respecting broker at a major securities house is not allowed to publish a report during the [blackout] period. We saw a number of reports from very small securities houses that don't observe the rules. Many of them seem very happy to see their name in print,' he said.

Steiner said existing shareholders and 'quality' new investors from across the globe understand the prospects for the business and have signed up for large holdings of more than 3%.

He said many investors, who understood the business and were experienced in backing online companies such as Amazon, ASOS and Google, had bought shares.

Steiner tried to silence naysayers suggesting the decision to cut the offer price was nothing to do with worries about the valuation of the company among potential investors but instead reflected his desire to have a stable shareholder base.