Funds raised from initial public offerings (IPOs) in Taiwan fell more than 30 percent annually last year, although the number of new listings on the local equity market rose slightly, according to PricewaterhouseCoopers (PwC) Taiwan.
In a report released on Tuesday last week, the accounting and consulting firm said NT$25.5 billion (US$797 million) was raised by IPOs on the local main board and the over-the-counter (OTC) market last year, a 32 percent annual decline.
Meanwhile, the number of companies that listed their shares for the first time on the main board and the OTC market last year was 60, two more than in 2015, PwC said.
The drop in the funds raised from IPOs last year was caused by newly listed companies often being small and medium-sized firms in the high-tech sector or in the cultural creative industry, the firm said.
Due to their relatively small paid-in capital, only four of the 60 newly listed companies raised more than NT$1 billion each, which pushed down the aggregate total last year, the firm said.
PwC said the performance of the new listings on the local equity market last year was the worst in five years, with 71 percent of them failing to gain 2 percent during the year.
The data defied conventional wisdom that new listings would soar largely because of the so-called honeymoon effect.
The capital market in Taiwan has been shrinking and lagging behind its neighbors in terms of IPO funds, PwC said, citing Hong Kong as an example, which raised US$25.11 billion last year, and Shanghai which raised US$15.12 billion.
Taiwan was not the only market that saw a drop in IPO funds last year, Securities and Futures Bureau deputy director Sam Chang (張振山) said.
Bureau data show that funds raised from IPOs in Taiwan in the first nine months of last year fell 48.25 percent from a year earlier, while in Hong Kong and Japan the drop was 64 percent and 54 percent respectively, Chang said.
Meanwhile, the number of firms launching IPOs could range between 55 and 60 this year, with biotech and high-tech firms dominating the new listings, PwC said.
In light of the government’s “new southbound policy,” companies in Southeast Asia are likely to launch IPOs in Taiwan’s capital market this year, the firm said.
Separately, Macquarie Capital Ltd has forecast that the TAIEX will challenge the 9,500-point mark this year, with the semiconductor sector driving the gains.
In a research note issued on Tuesday last week, the Australian brokerage said that after two consecutive years of consolidation, Taiwan’s integrated circuit industry will start gaining momentum this year and sales in the domestic semiconductor sector are likely to increase by 9 percent year-on-year on a cyclical uptrend in the memory chip business.
“We expect moderate upside to the TAIEX in 2017 driven by out performance in memory, semiconductors, automation, auto electronics, financials and defensive non-tech stocks,” Macquarie said in the note. “We remain negative on the LCD, PC, textile and footware sectors.”
The TAIEX closed at 9,372.22 points on Friday last week.
While the brokerage has forecast a rise in share prices in Taiwan this year, it has also cautioned that an interest rate hike cycle in the US and trade policy of US president-elect Donald Trump could cause volatility in the global financial markets.
The key risks for Taiwan are specifically politically focused, such as its relationship with China, it added.
CHIP RACE: Three years of overbroad export controls drove foreign competitors to pursue their own AI chips, and ‘cost US taxpayers billions of dollars,’ Nvidia said China has figured out the US strategy for allowing it to buy Nvidia Corp’s H200s and is rejecting the artificial intelligence (AI) chip in favor of domestically developed semiconductors, White House AI adviser David Sacks said, citing news reports. US President Donald Trump on Monday said that he would allow shipments of Nvidia’s H200 chips to China, part of an administration effort backed by Sacks to challenge Chinese tech champions such as Huawei Technologies Co (華為) by bringing US competition to their home market. On Friday, Sacks signaled that he was uncertain about whether that approach would work. “They’re rejecting our chips,” Sacks
It is challenging to build infrastructure in much of Europe. Constrained budgets and polarized politics tend to undermine long-term projects, forcing officials to react to emergencies rather than plan for the future. Not in Austria. Today, the country is to officially open its Koralmbahn tunnel, the 5.9 billion euro (US$6.9 billion) centerpiece of a groundbreaking new railway that will eventually run from Poland’s Baltic coast to the Adriatic Sea, transforming travel within Austria and positioning the Alpine nation at the forefront of logistics in Europe. “It is Austria’s biggest socio-economic experiment in over a century,” said Eric Kirschner, an economist at Graz-based Joanneum
BUBBLE? Only a handful of companies are seeing rapid revenue growth and higher valuations, and it is not enough to call the AI trend a transformation, an analyst said Artificial intelligence (AI) is entering a more challenging phase next year as companies move beyond experimentation and begin demanding clear financial returns from a technology that has delivered big gains to only a small group of early adopters, PricewaterhouseCoopers (PwC) Taiwan said yesterday. Most organizations have been able to justify AI investments through cost recovery or modest efficiency gains, but few have achieved meaningful revenue growth or long-term competitive advantage, the consultancy said in its 2026 AI Business Predictions report. This growing performance gap is forcing executives to reconsider how AI is deployed across their organizations, it said. “Many companies
France is developing domestic production of electric vehicle (EV) batteries with an eye on industrial independence, but Asian experts are proving key in launching operations. In the Verkor factory outside the northern city of Dunkirk, which was inaugurated on Thursday, foreign specialists, notably from South Korea and Malaysia, are training the local staff. Verkor is the third battery gigafactory to open in northern France in a region that has become known as “Battery Valley.” At the Automotive Energy Supply Corp (AESC) factory near the city of Douai, where production has been under way for several months, Chinese engineers and technicians supervise French recruits. “They
RSS