While fears of a recession have persisted in recent years, the initial public offering (IPO) market is slowly showing signs of recovery.。

Signs of an IPO recovery have been visible to the naked eye this year as the stock market rally has encouraged companies to test investor interest in IPO listings, especially in Asia, but a full global recovery seems far away。

According to media data, in March and April, the value of globally priced IPOs was about $25 billion, which is almost double that of January and February this year, as the number of listings at that time nearly stagnated.。

Some analysts said trading activity was particularly active in Asia, where regional exchanges accounted for nearly 80 per cent of new share sales in April, and the number of listings in Europe also picked up.。But the U.S. region is less optimistic, with recession fears discouraging U.S. regional issuers。The amount of money raised in the United States so far this year is down by more than half from the same period last year, and the size of transactions is also smaller on average, a phenomenon that has slowed the full recovery of global IPOs.。

Jason Manketo, global co-head of equity at Linklaters, said: "We are starting to see activity sprouting as the company restarts the suspended process, but there is still a considerable degree of uncertainty in the market.。"。"Before committing to an IPO, the buyer is keen to see several quarters of results.。This means that some potential channels for 2023 deals have been delayed until 2024.。"

 

Asian markets ahead of this year's IPOs

In-depth study of the data shows that Asia is undoubtedly the busiest listing region in the world at present。But one key change from 2022 is that the vast majority of large deals were previously concentrated in mainland China, but this year's IPOs are starting to slowly flow into the wider Asian region.。

Among them, Indonesia is a bright spot, two nickel metal producers began to soar after their debut this year。In addition, Thursday by KKR & Co..Supported Chinese liquor company Zhenjiu Li Du (ZJLD Group Inc.) also announced the pricing of the largest IPO of 2023 in Hong Kong, raising a total of HK $5.3 billion.。

Goldman Sachs Group Inc.) James Wang, co-head of equity capital markets in Asia (excluding Japan), said: "The IPO market is slowly returning.。While not yet 100% recovered, there are already signs of recovery and renewed vigor。"。

 

The European IPO market is also slowly awakening in the face of adversity.

The European IPO market has been stagnant due to geopolitical and other factors that have brought news of listings in the European market to an abrupt end in the past two years, with IPO activity in 2023 down about 12% from the same period last year。

Poor IPO returns have been a major hurdle for investors。Portfolio managers have been pushing hard deals on valuations and refusing to pay high prices for unproven new companies。In addition, the sudden bankruptcy of Credit Suisse Group AG (Credit Suisse Group AG) also triggered a plunge in global markets, a phenomenon that exacerbated investor concerns about interest rates and inflation, further disrupting the listing plan.。

But there are signs that pessimism has eased。Most notably, Apollo Global Management Inc..) Italian bookmaker Lottomatica SpA had an initial public offering (IPO) of 600 million euros last week (about 6.$5.7 billion), becoming the third major company to take advantage of a European exchange this year。In addition, German web hosting company Ionos SE and motor parts maker EuroGroup Laminations SpA have managed to raise more than $400 million in the region, and while both stocks have taken a step forward since their listings, it is also a sign that the market is recovering.。

 

The "dragging" of the US market

While signs of recovery are emerging in Asian and European markets one by one, the outlook for the U.S. IPO market remains challenged.。Companies listed on U.S. exchanges raised just $4.1 billion this year, with just three of them - Nextracker Inc., Atlas Energy Solutions Inc., and Enlight Renewable Energy Ltd.。

In fact, with the exception of the cluster and the dozen SPACs that debuted this year, the vast majority of newly listed companies qualify as low-priced stocks.。

Greg Martin, co-founder of Rainmaker Securities, said: "We are still in a macro environment full of uncertainty, which happens to be the worst thing for an IPO.。

There is growing evidence that the U.S. may be heading for a recession, and the Fed's path forward on interest rates remains unclear。

Patrick Galley, CEO and CIO of RiverNorth Capital Management, said: "How do you price a deal when you don't know exactly what the cost of capital should be on a forward-looking basis?。"。"Clear interest rates are key.。"