IPO funds rose eight-fold in the first quarter

The 32 new listings in the first quarter, raised some $132.8b in IPO funds.

Initial public offerings (IPO) raised some $132.8b funds from 32 new listings in the first quarter of the year, a record high increase for the January to March period over the past years, Deloitte has calculated.

The IPO raisings this year reflected an 842% surge in proceeds against the $14.1b recorded in the first quarter of 2020. The number of listings, however, dropped from 37 IPOs.

"This (the succesful listings) benefited from a strong support from new economy IPOs which contributed nearly 90% of these funds,” Edward Au, Southern Region managing partner, Deloitte China, said.

“This shows that investment appetite is transforming and that there is continuous enthusiasm among China concept stocks to list in Hong Kong, so as to divert their fundraising platforms into more capital markets."

According to Deloitte, New York City's Nasdaq took over the global leadership this quarter, in terms of the number of listings and funds raised. The Hong Kong Stock Exchange came in second, whilst the New York Stock Exchange, London Stock Exchange and Shanghai Stock Exchange followed in that order.

The same report noted that Hong Kong and Mainland China’s IPO Market would likely perform “vibrantly” and remain resilient for the rest of the year. This will be driven by the expected high-growth of new economy companies.

Further, the National Public Offering Group maintained its forecast of 120-130 IPOs in 2021, estimated to raise some $400b in IPO funds.

“This is backed by economic easing measures bracing strong liquidity to seek high return in the market through investment funds and vehicles, also the continuous wave of secondary listings of China concept stocks in the US, and listings of new economy companies, including those in the biotech sector,” Deloitte added.

Meanwhile, new listings in Mainland China increased 96% to 100 IPOS against 51 in Q1 2020. The funds raised, however, dropped by 3% to $90.4B (RMB76.1b) from $92.8B (RMB78.1B).

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