Malaysia has seen a string of small-cap technology initial public offerings (IPO), raising US$500 million (US$1=RM4.50) in 16 deals, in line with South-east Asia’s year-on-year rise in IPO volume of 26 per cent.
This is from 65 deals in 2022 to 82 deals year-to-date 2023, said EY Global.
“Indonesia has been a shining light in the region, hosting 45 IPOs in the first half of the year, with total proceeds of US$2.2 billion,” it added.
Thailand hosted listings from a diverse range of sectors that raised US$500 million in 15 deals in the first half of 2023; followed by Philippines (three IPOs raising US$77.7 million) and Singapore (three IPOs raising US$21.1 million).
Its IPO leader Paul Go noted that against the backdrop of a divergent global economy and unpredictable geopolitical landscape, some stock markets are reaching a long-time high and enjoying low volatility.
“Certain theme-centric sectors such as technology and clean energy are signalling an upswing in IPO activity.
“Large, well-established companies are demonstrating enduring resilience, while growth narratives with more realistic and acceptable valuation are becoming more receptive by the market,” Go said in a statement.
He advised that in this shifting environment, companies need to prepare now to be IPO-ready for any forthcoming windows.
On the second-half outlook, EY Global said a resurgence in global IPO activity is anticipated to start in late 2023 as economic conditions and market sentiment gradually improve with the tight monetary policy entering its final stage.
“Large corporate spin-offs and carve-out listings will likely surface across major markets as companies seek to create more shareholder values through divestiture while investors lean toward mature, profit-making businesses amid a yet-to-revive IPO market,” it said.
“Investors will continue to be more selective, orienting toward companies with solid fundamentals and proven track records,” it added.
