ASEAN saw a total of 23 initial public offerings (IPOs) raising US$2.4 billion in the first quarter of 2021, down from the 32 listings raising US$3 billion over the same period last year, according to an Ernst & Young (EY) press statement on Thursday.
Thailand's exchanges raised US$1.6 billion from five IPOs, while Indonesia led in deal numbers with 12 IPOs, said EY. This is followed by Malaysia which had four IPOs and the Philippines and Singapore which each saw one IPO listed in Q1.
EY Asean IPO leader Max Loh noted that the first quarter is typically a muted period for IPOs in Asean, as companies gear up for capital market activities.
"Cautious optimism prevails with existing uncertainties, providing a cocktail of volatility in the Asia-Pacific IPO markets. Companies will need to be resilient to challenges and prepare early to be successful in their IPO aspirations," he said.
Elsewhere, Asia-Pacific (APAC) IPOs defied expectations, maintaining a positive momentum. The APAC region kick-started the year by accounting for 47 per cent of global IPO activities in Q1 2021.
The region also saw 200 IPOs raising US$34.3 billion in proceeds, achieving the highest Q1 proceeds in 20 years, beating the former record from Q1 2010, EY said.
Further, the technology sector outpaced other sectors by both volume and proceeds, with a total number of 51 IPOs raising US$17.7 billion.
The Americas exchanges saw the highest combined deal numbers and proceeds in over 20 years, while the IPO markets in Europe, the Middle East, India and Africa "roared to life" with 109 IPOs and US$26.1 billion in proceeds after a quiet 2020.
EY attributed the surge in momentum to "ample liquidity and new opportunities propelled by the Covid-19 pandemic".
Further, the auditing group cited "speculative and opportunistic transactions" along with the "popularisation of retail investing platforms among the public" as reasons for the accessibility of investing, which contributed to the record-breaking IPO market in Q1 2021.
However, while sentiments are trending positive, EY highlighted that uncertainties will continue to weigh, creating market volatility.
"The likelihood of new waves of the Covid-19 pandemic around the world combined with differing global vaccination progress, geopolitical tensions, inflation, interest rates and the ability of the global financial systems to withstand unexpected market shocks are all potential ingredients for a perfect storm," the auditing group said.