IPO Outlook

With key risks to the global economic outlook easing, we expect IPOs to hit a new post-financial crisis high in 2018.
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Koen Vanhaerents,
Global Chair, Capital Markets
As anticipated in our last edition of GTF, the IPO market has rebounded in 2017 ahead of the M&A cycle. At the global level, domestic IPOs rose to US$146 billion in 2017, up from US$92 billion in 2016. We forecast that domestic IPO activity will continue to rise, to a peak of over US$220 billion in 2018, then cool in subsequent years. However, as equity valuations become more stretched, and borrowing costs start to rise, the value of domestic IPO proceeds will cool in subsequent years.

2 Domestic IPO market accelerates

Domestic IPO chart

1 Sectors:
Tech, consumer and finance to drive IPO activity

From a sectoral perspective, tech and telecom is expected to drive the rebound in IPO activity in 2018, aided by the Chinese government’s efforts to spur tech firms to go public. With household spending remaining strong globally, consumer companies should also benefit from positive market conditions. Likewise, with low interest rates likely to support household and corporate borrowing in the next few years, finance issues should also drive IPO activity higher.
Global IPO by sector
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