IPO activity slows amid geopolitical uncertainties, trade tensions

IPO activity slows amid geopolitical uncertainties, trade tensions

By: 
Stanislaus Jude Chan
04/07/18, 03:52 pm

SINGAPORE (July 4): Geopolitical uncertainty, trade issues and macroeconomic conditions are dampening investor enthusiasm for initial public offerings (IPOs), according to the quarterly Global IPO trends: Q2 2018 report published today by professional services firm EY.

Singapore saw its IPO activity fall 60% y-o-y in 2Q18, with four IPOs during the quarter raising just US$0.07 billion ($0.10 billion) – some 79% lower than the corresponding quarter last year.

Year-to-date, this brings the total number of IPOs in the city-state to seven, down 30% compared to a year ago.

“There have been no major developments since Q1 and the Asean IPO market while active, with a slight increase vis-à-vis Q1, has not stirred with any major activity in Q2,” says Max Loh, EY Asean and Singapore Managing Partner, Ernst & Young.

“Geopolitical uncertainty, trade tensions and emerging market concerns continue to weigh down on IPO activity in Asean,” he adds. Asean saw a 33% dip in IPO volume to 26 IPOs in 2Q18, but IPO proceeds surged 80% to US$3.1 billion on the back of the strength of listings on Vietnam’s main markets.

According to EY, Vietnam led the way in IPO proceeds for Southeast Asia in 2Q18 with two sizeable listings, while IPOs in other parts of the region — Thailand, Indonesia, the Philippines, Malaysia and Singapore — have predominantly been small-cap listings.

The firm expects this trend to continue into the second half of 2018.

Globally, IPO activity decreased by 21% to 660 IPOS in 1H18. Despite this slowdown, global IPO markets raised US$94.3 billion during the period, up 5% y-o-y.

“The good news is that economic conditions continue to be encouraging, equity valuations are high in many parts of the world and interest rates remain low. As a result, we expect a resurgence in IPO activity during the second half of 2018,” says Martin Steinbach, EY Global and EMEIA IPO Leader.

Looking beyond quarterly fluctuations in ST Engineering’s growth story

SINGAPORE (Nov 17): ST Engineering’s latest third-quarter results have shown improvements in profitability in three of its four key business units of aerospace, electronics, land systems and marine. In addition to the main four, there is an “others” unit, which lumps together shared services, new ventures and other related activities. It reported a loss of $7.3 million. ST Engineering’s latest third-quarter results have shown improvements in profitability in almost all its business units. The marine unit, on the other hand, suffered a 35% y-o-y drop in earnings to $12.8 millio....
Read More >>

iFAST founder Lim confident China business will be exciting

SINGAPORE (Nov 16): Lim Chung Chun, chairman and CEO of iFAST Corp, believes long-term diversification is the best strategy to grow its assets under administration (AUA). Indeed, the company’s AUA has grown 18.7% y-o-y to hit a new record high of $8.5 billion as at Sept 30. Although the expansion of its unit trust platform into a wealth management solution distributing stocks, bonds, exchange-traded funds (ETFs) and insurance has been pretty successful, its geographical expansion into the mainland Chinese market for his B2B wealth management solutions hasn’t quite hit its marks yet. ....
Read More >>

How IoT in agriculture could present new opportunities for investors

SINGAPORE (Nov 16): Earlier this year, Avarga, formerly known as UPP Holdings, said it was acquiring a 23.08% stake in local start-up Archisen for up to $1.5 million in three separate tranches. Ian Tong, Avarga’s executive director, is on ­Archisen’s board. Tong is also the executive director of The Edge Media Group, which publishes The Edge Singapore. While indoor farming is not new, high-tech IoT-enabled farm Archisen is drawing on technical expertise from its partners to improve tis production within a controlled environment, shielded from the vagaries of weather that have t....
Read More >>
BMW charges up an 'electrified future'

Christopher Wehner, managing director of BMW Group Asia, explains how electric cars such as the BMW