Overall regional performance: waiting for a comeback in 2023 and more favorable market conditions to return
The Americas’ IPO activity sank to lows not seen since the peak of the great recession. It hit a 13-year low by volume and a 20-year low by value as markets were affected by volatility and policies undertaken to combat inflation. Both number of IPOs and proceeds took a nosedive, with 130 deals raising US$9b, down by 76% and 95%, respectively, YOY. Not surprisingly, most of the Americas’ IPOs (69%) were on US exchanges.
The Asia-Pacific IPO market had 845 IPOs totaling US$120.6b in proceeds, taking the smallest hit by the global economic downturn and geopolitical tensions, accounting for 63% of deals and 67% of funds raised in 2022. Mainland China is on course towards another record-breaking year of capital raising by the close of 2022.
EMEIA IPO activity fell by 53% and 55% by number and proceeds, respectively, recording 358 IPOs raising US$49.9b. Even though Europe IPO activity was down 78%, due to geopolitical turmoil, MENA was up 115% by proceeds as it benefited from the large energy and other IPOs completed, coupled with the initiative rolled out by the government’s privatization plan. EMEIA also delivered 5 of the top 10 IPOs.
2023 outlook: waiting for the right window while focusing on fundamentals and ESG
Looking ahead to 2023, there is a strong IPO pipeline on the horizon. Even though IPO activity will likely remain somber through at least the first quarter, more favorable conditions seem to be set in place for global IPO activity to regain greater momentum by the second half of the year.
For the IPO market to become more active again, there are a number of prerequisite conditions: positive sentiment and an uptick in stock market performance; lower inflation and ending of the interest rate hikes; easing of geopolitical tensions; and diminished COVID-19 pandemic effects on the economy.
Many prospective IPO companies are still going to take the “wait-and-see” approach, holding out for the right window. For now, investors will focus on a company’s fundamentals, such as revenue growth, profitability and cash flows, over just growth projections.
As there is a positive correlation between companies’ post-IPO share price performance and the communication of their environmental, social and governance (ESG) strategies, investors will also increasingly be looking at the company’s ESG agenda.
“As pipeline continues to build, many companies are waiting for the right time to revive their IPO plans,” says Go.
“Still, with tightening market liquidity, investors are more risk-averse and favor companies that can demonstrate resilient business models in profitability and cash flows, while clearly articulating their ESG agendas,” he adds.
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Data definitions for all charts
The data presented on this webpage and in the EY Global IPO press release 2022 is from Dealogic and EY analysis. The year 2022 refers to the full calendar year and covers completed IPOs from 1 January to 5 December 2022, plus expected IPOs by 31 December 2022 (forecasted as of 5 December 2022). Data is up to COB 5 December 2022.
- In compiling the IPO statistics included in these reports and press releases, we focus only on IPOs of operating companies and define an IPO as a "company's offering of equity to the public on a new stock exchange".
- This report includes only those IPOs for which Dealogic and EY teams offer data regarding the first trade date (the first day on which the security start trading on a stock exchange), and proceeds (funds raised, including any over-allotment sold).
- The first trade date determines which quarter a deal is attributed to. Postponed IPOs, or those that have not yet been priced, are therefore excluded. Over-the-counter (OTC) listings are also excluded.
- In an attempt to exclude non-operating company IPOs such as trusts, funds and special purpose acquisition companies (SPACs), companies with the following Standard Industrial Classification (SIC) codes are excluded:
- 6091: Financial companies that conduct trust, fiduciary and custody activities.
- 6371: Asset management companies such as health and welfare funds, pension funds and their third-party administration as well as other financial vehicles.
- 6722: Companies that are open-end investment funds.
- 6726: Companies that are other financial vehicles.
- 6732: Companies that are grant-making foundations.
- 6733: Asset management companies that deal with trusts, estates and agency accounts.
- 6799: Special purpose acquisition companies (SPACs).
Definitions for IPO performance by geography
- Africa includes Algeria, Botswana, Egypt, Ghana, Kenya, Madagascar, Malawi, Morocco, Namibia, Rwanda, South Africa, Tanzania, Tunisia, Uganda, Zambia and Zimbabwe.
- Americas includes Argentina, Bermuda, Brazil, Canada, Chile, Colombia, Ecuador, Jamaica, Mexico, Peru, Puerto Rico and the United States.
- ASEAN includes Brunei, Cambodia, Guam, Indonesia, Laos, Malaysia, Maldives, Myanmar, North Mariana Islands, Philippines, Singapore, Sri Lanka, Thailand and Vietnam.
- Asia-Pacific includes Asean (listed above), Greater China (as stated below), Japan, South Korea, Australia, New Zealand, Fiji and Papua New Guinea.
- EMEIA includes Armenia, Austria, Bangladesh, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, India, Ireland, Isle of Man, Italy, Kazakhstan, Luxembourg, Lithuania, Netherlands, Norway, Pakistan, Poland, Portugal, Russian Federation, Spain, Sweden, Switzerland, Turkey, Ukraine and United Kingdom plus the Middle East countries (listed below) and Africa countries (listed above).
- Greater China includes Mainland China, Hong Kong, Macau and Taiwan.
- India region includes IPO activity in Indian and Bangladesh stock exchanges.
- Middle East includes Bahrain, Iran, Israel, Jordan, Kuwait, Oman, Qatar, Saudi Arabia, Syria, United Arab Emirates and Yemen.
Definitions for IPO deals by sector and IPO proceeds by sector
Sectors are classified according to Thomson general industries using a company’s Sector Industry Classification (SIC) code. There are 11 sectors, which are defined below with their specific industries. The 11 sectors are shown on the horizontal axis.
- Consumer includes the combination of “Consumer staples” and “Consumer products and services” sectors. Its specific industries include: agriculture and livestock, food and beverage, household and personal products, textiles and apparel, tobacco, educational services, employment services, home furnishings, legal services, other consumer products, professional services, as well as travel services.
- Energy industries include alternative energy sources, oil and gas, other energy and power, petrochemicals, pipelines, power, as well as water and waste management.
- Financial industries include asset management, banks, brokerage, credit institutions, diversified financials, government sponsored enterprises, insurance, as well as other financials.
- Health care industries include biotechnology, health care equipment and supplies, health care providers and services (HMOs), hospitals, as well as pharmaceuticals.
- Industrials industries include aerospace and defense, automobiles and components, building/construction and engineering, machinery, other industrials, transportation, as well as infrastructure.
- Materials industries include chemicals, construction materials, containers and packaging, metals and mining, other materials, as well as paper and forest products.
- Media and entertainment industries include advertising and marketing, broadcasting, cable, casino and gaming, hotels and lodging, motion pictures or audio visual, other media and entertainment, publishing, as well as recreation and leisure.
- Real estate industries include non-residential, other real estate, real estate management and development, as well as residential.
- Retail industries include apparel retailing, automotive retailing, computers and electronics retailing, discount and department store retailing, food and beverage retailing, home improvement retailing, internet and catalogue retailing, as well as other retailing.
- Technology industries include computers and peripherals, electronics, internet software and services, IT consulting and services, other high technology, semiconductors, as well as software.
- Telecommunications industries include other telecom, space and satellites, telecommunications equipment, telecommunications services, as well as wireless.
Previous IPO reports
The EY Global IPO Trends 2022 highlights the decline of the global IPO market over the course of 2022. Many IPOs were postponed due to volatility caused by macroeconomic challenges, market uncertainties, increasing volatility and falling global equity prices.