Asia Pac IPOs strongest since 1980, raise $125 bn till Sept of CY21

IPO proceeds up 73% from a year ago; number of offerings grow 42.3% YoY

Asia Pacific, excluding Japan, investment banking fees reached an estimated $23.6 billion during the first nine months of 2021, a 6.9 per cent increase from the comparative period last year, making it the highest first nine-month period since records began in 2000.

Equity capital markets (ECM) fees totaled $8.2 billion, up 21 per cent from a year ago and the strongest first nine-month period since records began in 2000. Debt capital markets (DCM) underwriting fees amounted to $10.2 billion, a 6.5 per cent decline from last year’s record period, but still elevated compared to historical levels. Fees from completed M&A transactions totaled $2.4 billion, a 9.4 per cent increase from the same period last year. Syndicated loan fees grew 27.9 per cent from a year ago and reached $2.8 billion.

DCM fees accounted for 43.1 per cent of the overall Asia Pacific investment banking fee pool, followed by ECM underwriting fees with 34.8 per cent and syndicated lending fees with 11.8 per cent. Completed M&A advisory fees represented 10.3 per cent of the region’s investment banking fees.

Citic took the top position for overall investment banking fees in Asia Pacific, excluding Japan, in the first nine months of 2021, capturing 5.9 per cent of the wallet share.

Record ECM activity

Equity and equity-related issuance saw its strongest-ever first nine months period, raising a total of $362.6 billion so far this year, a 33 per cent increase in proceeds from a year ago. Asian issuers are tapping the equity capital markets at a record pace with number of issuances witnessing the busiest-ever first nine months period with 2,591 deals, up 20.4 per cent from the same period last year.

Initial public offerings (IPO) saw the highest first three quarters since records began in 1980 and raised $124.5 billion in proceeds, up 72.7 per cent year-on-year, as number of IPOs hit the busiest year-to-date (YTD) period and grew 42.3 per cent from a year ago. This was driven by Chinese IPOs which accounted for 64.4 per cent of the region’s IPO proceeds, and 26.7 per cent of the IPO proceeds worldwide. South Korea, India, Australia and Southeast Asia also witnessed strong growth in IPO issuances, pushing Asia Pacific IPOs to account for 41.4 per cent of the global IPO proceeds.

Follow-on offerings also saw an all-time high raising $187.5 billion during the first nine months of this year, up 12.4 per cent in proceeds from the same period last year. Asia Pacific convertible bonds reached record levels and totaled $50.6 billion in proceeds, a 49.9 per cent growth year-on-year.

High technology sector accounted for 23.5 per cent of Asia Pacific’s ECM activity, raising $85.1 billion, more than double the proceeds raised compared to a year ago. Industrials and Financials captured 15.7% and 12.5% market share, respectively.

Citic currently leads Asia Pacific’s ECM underwriting rankings, with a 7.8 per cent market share and $28.4 billion in related proceeds.