Global IPO Market Defies Economic Slowdown, Listings Rise 11 Percent in Q3

Americas, EMEIA region see IPOs surge while Asia-Pacific struggles

The Americas saw a total of 57 IPOs in Q3 2024, a 39 percent increase from 41 in Q3 2023. However, the proceeds dropped from US$9.2 billion to US$8.4 billion, an 8 percent decline.

On a global scale, the Americas region saw an uptick, accounted for 18 percent of IPOs globally compared to 11 percent year over year. Its share of proceeds was even larger, capturing 34 percent of global IPO proceeds compared to 24 percent in Q3 2023.

Meanwhile, the Europe, Middle East, India and Africa (EMEIA) region recorded 144 IPOs — a 20 percent increase from 120 in Q3 2023 — but saw proceeds decrease from US$8.2 billion to US$6.9 billion, representing a 16 percent drop.

Globally, the EMEIA region represented 47 percent of all IPOs, up from 34 percent a year prior.

Contrary to the notable successes of the preceding regions, the Asia-Pacific experienced a significant downturn.

The region only recorded 109 IPOs in Q3 2024, a steep 45 percent decline from 198 in Q3 2023. Proceeds also fell sharply from US$20.9 billion to US$9.6 billion, a 54 percent fall.

Cross-border IPO listings gain traction

Cross-border listings have gained momentum, reflecting a growing trend of international companies choosing to list in more favorable markets.

In the first three quarters of 2024, 77 companies opted for overseas listings, marking a 20 percent year-over-year increase. This trend has been particularly pronounced in the US market, which has attracted more foreign listings than ever, driven by strong liquidity and more advantageous valuations, EY analysts explained.

In fact, foreign-domiciled issuers account for approximately 52 percent of IPOs on US exchanges since 2023, highlighting a strategic shift by international firms seeking better market conditions.

Moreover, stock exchanges worldwide are adapting their listing regimes to accommodate evolving business landscapes.

The UK introduced significant reforms to enhance its competitiveness this year, while the Hong Kong Exchange relaxed listing requirements to attract IPOs from specialist technology firms.

Sector-specific IPO dynamics

The current market landscape has led to a broadening of the IPO sectors, allowing for a more diverse range of investment opportunities.

Sectors less affected by rate fluctuations, such as industrials, materials and energy, have shown resilience during monetary tightening phases.

On the other hand, capital-intensive sectors, including health, technology and real estate, experienced significant declines in their global shares due to rising borrowing costs.

As the interest rates decrease, these sectors seeing renewed activity in IPO activity, potentially leading to more robust investor engagement.

IPO outlook for Q4 2024 and beyond

Looking ahead, the IPO landscape in Q4 2024 and beyond is expected to be influenced by central bank policies, geopolitical developments and key election outcomes.

Optimism is fueled by the prospect of lower interest rates and easing inflation, which are anticipated to encourage new listings and revive sectors sensitive to borrowing costs. Major markets, including the US, Europe and India, are poised to continue their strong performance, bolstered by increased investor interest and favorable economic conditions.

More crucially, the AI sector remains a focal point for IPO activity, with nearly 50 AI companies currently in IPO registration and sustained investor enthusiasm.