The global IPO market is showing signs of recovery amid intensified initial public offerings in Asia, analysts believe.
According to calculations of Bloomberg agency, in March and April IPO in the world were carried out to the amount of about $ 25 billion, which almost doubles the figure for the first two months of this year.
Issuers from Hong Kong to Milan saw a window of opportunity as volatility in the markets declined. Activity over the past two months has been particularly buoyant in Asia, with local exchanges accounting for nearly 80% of April’s IPOs. The number of listings in Europe has also increased. Meanwhile, fears of a U.S. recession are scaring away U.S. issuers, slowing the full recovery of the global market.
On average, transaction sizes remain smaller than before. The amount of money raised in IPOs this year is about half what it was during the same period last year.
“We’re starting to see sprouts of activity, companies are resuming processes that were suspended, but there’s still a significant degree of uncertainty in the market,” says Jason Manketo, one of the heads of Linklaters law firm.
“The IPO market is coming back gradually and slowly,” notes Goldman Sachs Asia analyst James Wang. – It’s not back 100% yet, but there are signs of life and energy recovery.”
The draft ownership policy of JSC Ukrzaliznytsia does not envisage a possibility of holding an initial public offering (IPO) for the company, Ukrzaliznytsia Director for Strategic Development and Investment Policy Anton Sabolevsky told reporters on the sidelines of the third International Conference “Railways of Ukraine: Developments & Investments” held in Kyiv. “The draft ownership policy, which is now being considered, does not mention the possibility of an IPO. This is not a question of a year or three, it is more distant. It will definitely not be held in the next five years,” he said.
According to Sabolevsky, in Europe the only successful transaction for holding an IPO for a part of a cargo carrier was in Poland. “Also, there is an example of Doicebahn, which was bought freight operators in the Netherlands, Denmark and partly in Sweden,” he said.
At the same time, according to Sabolevsky, for the next five years, Ukrzaliznytsia needs an additional investment of $6 billion to maintain its assets at current levels.
“If we look at the ratio of capital investment and company revenues, then, to a large extent, we will come to the conclusion that Ukrzaliznytsia must spend about $ 1billion on its capital investment a year. These are the sums which the company announces in its financial plan every year. For example, in 2018, we had a little more than UAH 26 billion of capital investment,” he said.
