Press release

27 Mar 2018 London, GB

Global IPO outlook remains robust after promising Q1 2018 results

Despite geopolitical uncertainties and market volatility, global IPO activity in the first three months of 2018 posted strong results to start the year.

Related topics IPO Growth
  • Global IPO capital raised is up 28% but deal numbers are down 27% year-over-year on Q1 2017
  • Americas’ activity improved in Q1 2018 both by number of deals and proceeds
  • Asia-Pacific continues to dominate global IPO activity by deal numbers
  • EMEIA proceeds rose by 191% in Q1 2018 due to mega deals

Despite geopolitical uncertainties and market volatility, global IPO activity in the first three months of 2018 posted strong results to start the year. Global IPO markets raised US$42.8b in Q1 2018, a 28% year-over-year (YOY) increase on Q1 2017.

However, with 287 listings this quarter, volume was down 27% YOY compared with Q1 2017, when it produced the highest number of listings for first quarter IPOs since 2007. These and other findings were published today in the EY quarterly report, Global IPO trends: Q1 2018.

Dr. Martin Steinbach, EY Global and EMEIA IPO Leader, says:

“Global growth in IPO proceeds outpaced deal numbers in a relatively strong first quarter. Driven by larger transactions, global IPO activity started out with a strong increase in proceeds in what is traditionally the slowest quarter of the year, despite a decline in deal numbers. However, market volatility in February did slightly dampen investor confidence, slowing momentum gained from calendar year 2017, the highest performing 12 month period since 2007. Looking ahead, the outlook remains positive in many markets around the world and we expect to continue to see IPOs from a range of sources including large tech, high growth, cross-border listings, carve-outs and state-owned enterprises.”

Americas begins 2018 with increased US IPO activity

Americas IPO activity started out on a high in the only region up over Q1 2017 in terms of proceeds and number of deals. There were 44 IPOs in the Americas in Q1 2018 raising US$15.4b, an increase of 29% in terms of volume and 22% by proceeds compared to Q1 last year.

US IPO activity accounted for 36 IPOs raising US$12.8b, up 44% in terms of volume and 17% by proceeds compared with Q1 2017. Additionally, five of the top ten global deals were featured in the US. Three of the top ten deals on US exchanges were also cross-border. In total, US exchanges accounted for 41% of all global cross-border activity in Q1 2018 compared to 35% in Q1 2017.

Jackie Kelley, EY Americas IPO Markets Leader, says:

“The first quarter of 2018 built strong momentum for the US IPO markets. Both the volume of deals and capital raised are significantly up from recent years, in large part due to strong performances to start the year in January. Positive IPO performance to date provides a strong backdrop for continued issuance, though potential uncertainty surrounding mid-term elections could present risk in the second half of the year.”

Asia-Pacific expects to rebound after a slow start in Q1

Asia-Pacific markets saw a decline in deal activity in Q1 2018 with 157 IPOs – a 39% drop when compared with Q1 2017, and the lowest quarterly total since Q2 2016. Total proceeds this quarter stood at US$11.4b, down 26% compared to Q1 2017 and the lowest level since Q1 2016. However, despite the drop in IPO activity, Asia-Pacific remained the world’s busiest region for new listings in Q1 2018.

Ringo Choi, EY Asia-Pacific IPO Leader, says:

“IPO activity in Asia-Pacific this quarter was defined by the slower pace of Mainland China IPOs due to greater regulatory scrutiny and a slowdown in many markets within the region. Swimming against the regional tide, the Hong Kong Exchange saw an increase in deals that made it the busiest exchange in the world. Looking ahead, we expect a bounce-back in IPO proceeds in the next few quarters, driven by the listing of mega IPOs in Hong Kong, Japan and the ASEAN region.”

EMEIA benefits from European mega deals and strong performances in India

EMEIA markets raised US$16.0b in Q1 2018 with 86 deals, placing the region second to Asia-Pacific in terms of deal numbers. Proceeds rose by 191% on the back of mega deals. The area saw 2 of the top 3 IPOs and 5 of the top 20 IPOs in Q1 2018. Of this activity, Europe accounted for 39 IPOs raising US$14.7b, of which 6 IPOs alone raised US$9.8b.

Emerging markets contributed strongly to overall IPO performance, with India’s Bombay and National exchanges recording a 14% increase in proceeds raised compared to Q1 2017 and a slight increase (5%) in terms of deal numbers (39 IPOs). The Middle East saw a 17% increase in IPO proceeds with former state-owned enterprises and family-owned and PE-backed businesses expected to drive IPO activity in the coming months.

Steinbach says: “EMEIA enjoyed a strong first quarter with a slew of European megadeals towards the second half of March pushing capital raised to the highest level for the first quarter since Q1 2015. We expect these deals will act as ice-breakers, preparing the way for a buoyant second quarter. With Indian markets performing well and the pipeline in the Middle East delivering a steady deal flow, prospects for the first half in EMEIA are positive.”

2018 outlook is upbeat, despite mixed signals

The outlook for 2018 looks to be promising driven by strong equity markets and sound corporate earnings. Despite expected interest rate hikes also later this year and uncertainty around potential trade policies, steady investor confidence is encouraging a healthy pipeline across sectors and markets this year.

- Ends -

Notes to Editors

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About the data
Analysis in this press release includes all deals listed up to 14 March 2018 and EY’s expectation of deals that will close in the rest of the month. Data has been sourced from Dealogic as of 14 March 2018. IPO activity from January 2018 through March 2018 is based on priced IPOs as of 14 March 2018 and expected IPOs by the end of 31 March 2018.

2019- Q1 2018 Global IPO activity info graph

Appendix: January 2018 to March 2018 global IPOs by sector

Sector Number of IPOs Percentage of global IPOs Proceeds (US$m) Percentage of global capital raised
Consumer products and services 35 12.2% $5,152 12.0%
Consumer staples 27 9.4% $2,220 5.2%
Energy 18 6.3% $4,525 10.6%
Financials 14 4.9% $5,2348 12.2%
Health care 30 10.5% $7,174 16.7%
Technology 38 13.2% $4,539 10.6%
Industrials 45 15.7% $4,711 11.0%
Materials 32 11.1% $1,632 3.8%
Media and entertainment 16 5.6% $1,149 2.7%
Real estate 18 6.3% $5,131 12.0%
Retail 10 3.5% $1,294 3.0%
Telecommunications 4 1.4% $83 0.2%
Global total 287 100.0% $42,846 100.0%


Growth Markets

Maya Vautier, EY Media Relations and Social Media Supervising Associate - Growth Markets/World Entrepreneur of the Year

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