Interest in tech IPOs is rising after a resurgence in Internet and electronics floats
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Things are looking up for tech floats.
After a weak 2016, the global tech IPO market rebounded in 2017, with the second-highest number of listings and third-most cash raised in the last decade, reports PricewaterhouseCoopers.
“A lack of major Unicorn IPOs and a lukewarm after-market performance of many IPOs, created a clear sense of underachievement” about tech floats around the world last year, said PwC tech lead Raman Chitkara in research released this week.
“Looking ahead, with strong economic indicators across the globe, 2018 promises to build on the momentum of 2017.”
Last year there were 100 major technology IPOs (raising $US40 million or higher) around the world — an 85 per cent jump over the previous year, the report found.
The 100 IPOs reviewed in the report raised a total of $US25.1 billion.
However despite a number of “mega IPO deals” — the likes of Snap, Netmarble Games, Landis+Gyr Group and China Literature — total cash raised was less than 2014 or 2015.
The top five global tech IPOs of 2017 were:
Only one Australian tech IPO made the global top 100 – Credible Labs which listed in December after raising $A66 million.
The most popular IPO tech sectors were Internet software and services. This included 27 IPOs such as Snap, Netmarble Games, Delivery Hero, China Literature and Qudian which raised a total of $US13.7 billion.
Electronics emerged “as a new star” with its best result for six years in cash raised ($US4.2 billion) and numbers (16 floats).
Semiconductors and software were the next best, followed by IT consulting, communications equipment and storage.
China dominates tech IPOs
Asian listings dominated global tech IPO activity, accounting for two thirds of major floats.
China last year saw its highest number of tech IPOs since 2011 with 51 listings – more than any other country.
However, the total value of the floats reached only $US7 billion. Qudian was the only major China tech float.
“However, a lack of a mega IPO in China left that market unable to match the proceedings [cash raised] of total US IPOs,” Mr Chitkara said.
“The China IPO market outpaced the United States with the number of listings.
“Cross-border listings in the US from China declined as more companies opted for IPOs in their home markets.”
The US IPO market rebounded in 2017 “after a depressing performance in 2016”.
The 24 major US tech floats last year raised $US8.1 billion compared to 16 floats raising $US 1.8 billion in 2016.
Major US listings Snap, Blue Apron, Cloudera, Okta, Despegar.com and Roku.