The Southeast Asia initial public offering (IPO) capital market saw 67 deals in the first half of 2024, with US$1.4 billion ($1.89 billion) in proceeds raised. Compared to the same period the year before, IPO deals in 1H2024 marked a 21% decrease while the amount raised fell by 59% y-o-y. These findings were in Deloitte’s 2024 Southeast Asia Mid-Year IPO Snapshot report published in July.
The market capitalisation for IPOs in 1H2024 came up to US$5.78 billion for the region, marking a sharp 71% drop from the market capitalisation of US$20.09 billion in 1H2023.
The decrease, which highlights a “lukewarm regional IPO outlook”, is due to the lack of blockbuster IPOs in the 1H2024. During this time, Southeast Asia only welcomed one large IPO, which raised over US$200 million, compared to three large IPOs which raised over US$600 million each in the 1H2023.
Among the Southeast Asian countries, Indonesia saw the highest number of IPOs with 25 listings raising US$248 million. This, however, stood in contrast to the country’s 44 IPOs in the year before, raising US$2.28 billion.
Malaysia saw the highest amount of proceeds raised at US$450 million with the second-highest number of IPOs with 21 listings.
Thailand came in second with US$427 million raised. The country saw the third-highest number of IPOs with 17 listings.
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In the first half of 2024, the top 10 IPOs were from Thailand, Malaysia, Indonesia, Vietnam and the Philippines, which contributed US$848 million or 62% of the total amount raised.
Thailand’s Thai Credit Bank Public Company Limited raised the highest amount at US$208 million while the Philippines’ OceanaGold (Philippines), Inc. came in next with US$104 million in proceeds. Malaysia’s life sciences and healthcare group Alpha IVF Group Berhad rounded up the top three placements with US$94 million raised.
Singapore saw one IPO in the 1H2024, Singapore Institute of Advanced Medicine Holdings, which raised US$20 million. The city-state saw three IPOs in 1H2023 with US$21 million raised then.
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According to Deloitte, the second half of the year has historically been the better-performing half between 2020 to 2022. But it has seen a downward trend between 1H2023 to 1H2024, signalling subdued IPO market sentiments on the back of macroeconomic factors such as the geopolitical climate, high-interest environment and reduced liquidity.
There has also been a shift in investors’ preference towards companies with proven profitability and sustainable cash flows over the growth-at-all-cost model.
“While Southeast Asia’s IPO market may appear subdued in 2024, there is cautious optimism that conditions will improve beyond 2024,” says Tay Hwee Ling, Deloitte’s Southeast Asia accounting & reporting assurance leader.
“As investors and IPO candidates adapt to the new norm of higher interest rates and reduced liquidity, they are becoming more adept at navigating the complexity in geopolitical tensions and the global economic landscape,” she adds.
Looking ahead, Tay sees the potential return of REIT listings in the region should interest rates decrease. In addition, she sees a “significant wave” of artificial intelligence (AI) IPOs in the coming years, due to the many AI and AI-associated businesses that are currently in the early seeding stages in the private domain.
