China an important market for global IPO activity

Initial public offering proceeds from the A-share market accounted for over 40 percent of the global total funds raised as of Nov 17, making the Chinese mainland an important market for global IPO activity, according to a recent report by global accounting firm Ernst & Young.

The report forecasts that over 300 companies are expected to debut on the A-share market in 2023, raising more than 350 billion yuan ($48.9 billion) throughout the year.

It said the Shanghai and Shenzhen stock exchanges are expected to rank top 2 global bourses by IPO proceeds this year.

As of November, four IPOs from the A-share market were among the global top ten IPOs, focusing on the technology and energy industry. Total funds raised by the top ten IPOs in China amounted to 82 billion yuan, representing 24 percent of total proceeds with a year-on-year decrease of 44 percent.

The technology, media, and telecom sectors were ranked top by both the number of deals and proceeds in the top ten IPOs in China, among which the top three IPOs by proceeds came from the semiconductor sector, accounting for 52 percent of the top ten.

Globally, there will be a continued slowdown in global IPO activity in 2023, with an anticipated total of 1,244 companies going public and raising $119.2 billion throughout the year. Compared to the same period last year, both IPO quantity and fundraising amount have declined by 12 percent and 35 percent, respectively, the report said.