While the issuance of Taiwan Depository Receipts (TDRs) has been popular on the local bourse this year, initial public offerings (IPOs) will regain center stage next year, as domestic and overseas companies are gearing up to tap Taiwan’s vibrant capital market, Ernst & Young said yesterday.
“The number of IPOs in Taiwan next year will double, with the majority being tech stocks,” said Ian Wang (王彥鈞), a partner in the firm’s Taiwan branch.
A total of 40 firms have launched IPOs this year, up from 21 last year, according to Ernst & Young.
More companies are expected to seek to raise funds in the capital market for the first time next year, either by listing on the Taiwan Stock Exchange or via secondary bourses, including the over-the-counter and GRETAI Securities markets, Wang told a media briefing.
Wang also said he expected TDR fever (TDRs refer to -overseas-listed companies that issue shares in Taiwan) to die down next year.
Enterprises that have issued TDRs this year included -Singapore-listed Super Group Ltd (超級集團), as well as Yangzijiang Shipbuilding Holdings Ltd (揚子江船業) and Digital China Holdings Ltd (神州數碼) — two Chinese firms currently listed in Singapore.
Shifting focus to Hong Kong, Ernst & Young said IPO fund-raising there is expected to reach at least HK$400 billion (US$51 billion) next year.
Buoyed by IPOs from Agricultural Bank of China and AIA Group, the Hong Kong Stock Exchange looks set to rank first in the world in terms of fund size this year — the second consecutive year it has dominated the global IPO market, he said.
In China, the Shenzhen Stock Exchange will rank second globally, having already garnered US$40 billion for the first 11 months of the year.
The Shanghai Stock Exchange will rank fourth after raising US$26.2 billion in the same period, according to Ernst & Young.
Vibrant IPO activities will continue into next year in China, with firms backed by venture capitalists set to issue shares in Shenzhen and resources, financial and industrial firms set to list in Shanghai, Wang added.
IPO fundraising this year is likely to set a new record with funds expected to surpass the US$300 billion mark, largely because of record-breaking IPO debuts in China.