SINGAPORE (Dec 16): The total number of IPO deals next year is expected to exceed those this year, says EY in its quarterly report, Global IPO trends: Q4 2019.
IPO activity is expected to pick up across all regions, particularly in the Americas where a number of large unicorns are expected to launch their IPOs in the US in the first half of 2020, adds the report.
"Looking ahead, several uncertainties will subside in 2020. Trade tensions between the US, China and the EU; the outcome of Brexit; and uncertainty with respect to the stability some European economies will fade in early 2020 and will positively impact overall IPO sentiment," says EY.
In 2019, geopolitical uncertainty and trade tensions heavily impacted the IPO landscape, pushing overall IPO activity down in terms of deals and proceeds.
The year saw 1,115 IPOs with proceeds of US$198 billion. This is 19% and 4% lower in deal volume and proceeds compared to 2018.
Asia-Pacific led the regions in the drop, with a 1% fall in deal volume to 668 deals from 2018 and an 8% fall in proceeds to US$.
In 2019, Southeast Asia’s exchanges saw 126 IPOs which raised US$8 billion in proceeds. This is a 4% increase in deal volume and rise of 11% in value over 2018.
Among the most actives were Indonesia which saw 54 IPOs raising US$1.1 billion; Malaysia which saw 29 IPOs raising US$0.5 billion and Thailand which saw 27 IPOs raising US$3.3 billion.
This was followed by Singapore which registered 11 IPOs raising US$2.8 billion and Philippines which saw four IPOs raising US$0.4 billion.
EMEIA (Europe, Middle East, India & Africa) was second by both deal volume and proceeds and the Americas third in both measures.
The technology sector continued to dominate in 2019 with 263 IPOs raising US$62.8 billion.
In terms of the number of deals, healthcare and industrials were active this year with 174 and 147 deals respectively.
In terms of proceeds, energy and healthcare also performed well at US$32 billion and US$22.5 billion.
Max Loh, EY Asean IPO leader and managing partner, Singapore and Brunei, Ernst & Young LLP, says: “As we move into 2020, we expect IPO activity to pick up though this would still be moderated by ongoing trade and economic headwinds and investor confidence. Singapore’s policy and market initiatives should prove fruitful in terms of improved IPO activity in 2020, particularly in the areas of REITs and business trusts. Across Southeast Asia, we expect that IPO activity will continue to be dominated by entrepreneurial companies coming to the public markets.”
