Led by the technology sector, the nation’s initial public offering (IPO) market could stage a rebound next year, after hitting rock bottom this year because of US-China trade tensions, PricewaterhouseCoopers (PwC) Taiwan said yesterday.
The number of IPOs could rise to 50 next year, from a record low of 39 this year, as the US and China eye a trade deal and companies make adjustments to rein in uncertainties, PwC Taiwan assurance services partner Lin Yi-fan (林一帆) said at a media briefing in Taipei.
“Firms involved in 5G deployment and artificial intelligence applications have evolved to such an extent that they would be ready for an IPO in the next two years,” Lin said.
The target is reasonable, as the Taiwan Stock Exchange and the Taipei Exchange have each said that their goal is to host 24 IPOs next year, he said.
Next year would be a turning point for Taiwanese companies, many of which used to consider China their first and only destination of choice for overseas expansion, but now believe it is wise and necessary to diversify, Lin said.
That awareness would not necessarily lead to relocation out of China, but setting up manufacturing bases in multiple locations to better cope with tariff disputes and other risks, he said.
Taiwan has emerged as a favorable investment destination and would become more attractive when uncertainty over the Jan. 11 elections subsides, Lin said.
Firms embracing automation, 5G and artificial intelligence technologies are fueling the business of local companies in those supply chains, he said.
The government’s policies to encourage capital repatriation have not yet achieved the desired effect, as many companies and investors have preferred to stay on the sidelines and see how others fare, Lin said.
Sentiment has also turned more positive in the local property market, with an uptick in prices and rents, he said.
PwC Taiwan is seeking to take advantage of the trend by setting up a real-estate brokerage division, PwC Taiwan chairman Joseph Chou (周建宏) said.
The new unit consists of 10 employees with their own revenue target, he added.
“PwC Taiwan is to turn 50 next year and it has to reposition itself by taking up new challenges,” Chou said.
The global economy is expected to slow next year, with monetary easing by central banks and household consumption expected to be the main growth drivers, PwC Taiwan said, adding that diversified manufacturing bases would gain importance as trade disputes linger.
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