Total value of all IPO deals in Q1’21 surged by 524%y/y to $210bn globally, statistics show

Charles Abuede

The total value of all initial public offering (IPO) deals completed in the first three months of 2021 witnessed a 524 per cent year on year growth to hit $201.1 billion in 2021, recent data presented by Buyshares and accessed by business a.m shows. Of the total value, the United States companies, European and Asian companies account for a large chunk of the total amount globally.

The year 2020, despite the being a pandemic year that disrupted plans for many businesses or companies from going public on various exchanges was also regarded as a fantastic year for investors who are into initial public offerings (IPO) and have benefited from both numbers of IPOs and their outsized average returns, in the face of the pandemic. Thus, the strong IPO activities have continued in the first months and also setting new records.

Furthermore, statistics obtained show that finance companies have raised almost $100 billion or half of the total value of all IPO deals since the start of the year 2021 and was followed by the technology sector with $48 billion worth of IPO deals in the review period; while Healthcare, consumer products and transportation have raised $13.2 billion, $6.5 billion and $6.1 billion respectively.

According to the Wall Street Journal and Dealogic data, in the United States, companies canvassed $144.4 billion through more than 400 public offer deals; this is a 157 per cent year on year increase in 2020. However, data also show that the public offering activity in the United State market saw an explosion this year, resulting in 4117.6 billion worth of IPO deals between January and March, a staggering 1,169 per cent year on year increase.

Further afield, Europe showed more impressive growth as companies within the continent raise $28.6 billion through public offering deals, 28 per cent more than the 2019 levels. However, the public offering activities surged in the first three months of this year with the total value of closed deals rising 2,392 per cent year on year to $31.1 billion. Elsewhere, Asia and the Latin America companies witnessed a not so overwhelming rise in the total value of public offering deals between January and March this year by 135 per cent and 406 per cent more than the same period in 2020 to $41.4 billion and $4.4 billion respectively.

Major IPOs this year were initiated by investment banks

Statistics also show that the combined value of the three largest IPO deals in the first quarter of this year hit more than $14.6 billion and these deals were initiated by major investment banks across the globe. One of the main roles of an investment bank is to serve as a sort of an agent between firms and investors through initial public offerings. They provide underwriting services for new stock issues when a company decides to go public and seeks equity funding.

Data show that Citibank tops the global list of investment banks with $21.1 billion worth of IPO deals in the first three months of 2021. Also, Goldman Sachs ranked second with $18.6 billion. Morgan Stanley, Credit Suisse, and JPMorgan consecutively follow with $13 billion, $11.3 billion, and $11.1 billion worth of deals, respectively.

On the breakdown of the largest public offer deals so far in 2021, Polish parcel-locker company InPost, in January, raised $3.9 billion in its initial public offering on Amsterdam’s Euronext exchange. This is regarded as the third-largest deal in Q1 2021. The firm went public at €16 a share, and on the first day of trading in Europe’s biggest IPO since 2018, the stock price jumped by 19 per cent, valuing InPost at $11.5 billion.

In February, shares of the Chinese short video company Kuaishou rose nearly 200 per cent at the open on its debut in Hong Kong. The TikTok rival raised $6.2 billion from IPO after pricing its shares at 115 Hong Kong dollars per one, making it the biggest deal in the first quarter of 2021 in China.

Last month, the South Korean e-commerce giant Coupang raised $4.5 billion in its market debut on the New York Stock Exchange and becoming the second-largest deal this year. Founded in 2010 by Korean-American billionaire Bom Kim, Coupang made a name for itself through its guaranteed same-day or next-day delivery service. The company’s stock began trading at $63.50 each, giving Coupang a market capitalisation of $102.2 billion.