Solid economic growth could drive a doubling of IPO activity this year.

Despite being one of the most attractive emerging markets right now, with a strong GDP growth rate of 4%, IPO funds raised fell by a third to US$4.4b. There were 11 deals in the year 2011, of which all but one listed in the first six months.

Nine of the IPOs that succeeded were backed by private equity funds. In total, 13 companies registered their plans to go public and only two changed their minds. Many of them sought private equity finance instead. On the upside, interest rates fell and inflation was brought under control.

IPO activity will pick up significantly this year

We expect to see around 20 successful deals, about twice the number that listed last year. There are several private equity IPOs in the pipeline and some multinational companies are likely to list their Brazilian subsidiaries.

Many companies want to go public in Brazil and they are just waiting for the right moment since they were sidelined by global markets’ problems last year, including the European crisis and slower global economic growth.

We could also see more South American companies from outside Brazil attempt an IPO and more activity on Bovespa Mais, the market for smaller–cap companies Hot sectors will be services, oil and gas and infrastructure, because the country is hosting the 2014 football World Cup and the 2016 Olympic Games, which requires strong investments in many sectors.

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