Memory-chip maker Kioxia Holdings soared 12% in its debut on the Tokyo Stock Exchange on Wednesday, underscoring decent investor demand for new shares in Japan.

After dropping at the start of the day, shares in the company extended gains in afternoon trading, rising far above their initial public offering price and valuing the firm at ?877 billion ($5.7 billion).

That¡¯s still a fraction of the $18 billion that a Bain Capital-led consortium forked over in 2018 to acquire it. Kioxia¡¯s shares closed at ?1,601, compared with its IPO price of ?1,455.

The world¡¯s No. 3 NAND chipmaker listed after years of complex and wide-ranging negotiations that involved Bain Capital, SK Inc, Western Digital and the Japanese government.

The company¡¯s IPO price was at the middle of a range it proposed before the offering. Most deals in Japan this year that gave a price range ended up debuting above the upper limit, Japan Exchange Group data shows.

¡°The price moves reflect expectations of its recovery,¡± said Seiichiro Iwamoto, a fund manager at Asset Management One. Its relatively cheap IPO price also helped lure some buying, he said.

Kioxia¡¯s price-to-book ratio is about 1.87 times, compared with 2.67 times for U.S. rival Micron Technology, Bloomberg-compiled data shows.

IPOs in Japan have raised about ?938 billion this year, the largest amount since 2018. While mammoth listings that included subway operator Tokyo Metro and X-ray device manufacturer Rigaku Holdings attracted investor attention, the number of deals has fallen to a decade low, suggesting that jumbo deals are dominating sales.

Investors are watching whether Kioxia, like other memory chip players, benefits from multitrillion-dollar spending on data centers around the world fueled by big tech firms from Microsoft to Amazon.

For now though, NAND memory ¡ª chips that store information in smartphones and data-center servers ¡ª hasn¡¯t yet fully recovered from a prolonged slump in prices, triggered by a severe downturn in global mobile demand from a COVID-era peak. Western Digital, with which Kioxia operates a manufacturing joint venture in northern Japan, recently warned that NAND pricing has stayed weak in the fourth quarter.

There aren¡¯t early indications that Kioxia¡¯s IPO will ¡°set the market on fire,¡± said Amir Anvarzadeh, Japan equity strategist at Asymmetric Advisors. ¡°Still, the fact that it is up a bit and the IPO came at the middle of its pricing range is relatively good given its poor backdrop.¡±