Singapore bucks waning IPO activity in Asia

Singapore Exchange ranked among the word's top 12 exchanges by capital raised.

According to Ernst & Young, Asian markets accounted for 76% of global IPO funds raised in Q3 2012, with 102 deals raising US$18.3b compared to 119 deals which raised US$15.8b in Q2 2012. Greater China alone accounted for 35% of deal numbers and 25% by capital raised (58 deals, raising a total of US$6.0b).

Compared to the same period last year, Asian exchanges increased their capital raised quarter-on-quarter, but the number of deals declined (136 deals which raised US$13.4b altogether).

Max Loh, Country Managing Partner at Ernst & Young LLP comments: “Although activity in China and Hong Kong was down in the quarter in line with the overall decline in economic growth, some markets like Malaysia and Singapore are very active, and some sectors, including mining, industrials and health care, are pursuing IPOs. The general consensus is that Asia-Pacific is performing better than last year with confidence due to some exceptionally large deals.”

Out of the top 10 global IPOs this quarter, six were listed on Asian stock exchanges. The largest Asian IPOs this quarter were the US$8.5b listing of Japan Airlines Co Ltd on Tokyo Stock Exchange, Malaysia’s IHH Healthcare Bhd which is dual-listed on Singapore Exchange and Bursa Malaysia (US$2.1b) and China’s Inner Mognolia Yitai Coal Co Ltd on Hong Kong Stock Exchange (US$0.9b).

“Asia has over 200 companies in the IPO registration pipeline – accounting for more than half of global IPO pipeline. As companies and investors wait for markets to improve, we could expect an uptick in activity in the last quarter of 2012,” says Max.

Singapore’s exchanges performed well in Q3 2012. The Singapore Exchange ranked among the top 12 exchanges by capital raised, with three deals raising US$913m, compared with US$349m from four deals in the last quarter.

“Of this, a number of IPOs pertain to REITs and business trusts, which underscores the strength, returns and performance of such IPOs in Singapore,” adds Max. Catalist, with four deals raising US$20.5m, came up among the top 12 exchanges by deal volume.