IPO market on track in 2018

The first half of the year has seen a strong market for initial public offerings (IPO), which has set a positive scene for the rest of the year, as historically there are more listings in the second half of the year than in in the first, according to the HLB Mann Judd IPO Watch.

The study found that although there were still fewer listings during the first six months of the year in 2018, compared to the prior year (39 against 57), this year has outperformed the previous five-year average.

At the same time, the subscription rates achieved so far was an indication of a well-performing market, the firm said.

As far as the companies were concerned, small-cap companies, which saw a considerable number of new entrants to the market in 2018, experienced strong support from investors.

Additionally, there was also a return of large-cap companies to the market, with eight new listings between January and July 2018 exceeding $100 million market cap.

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Looking ahead, HLB Mann Judd’s partner, Marcus Ohm, said the resources sector would appear to be the strongest contributor to upcoming listings in terms of numbers.

“On 1 July 2018, there were 35 companies that had applied to list on the ASX, and eleven of these are in the materials sector,” Ohm said.

“Technology stocks are also showing signs of improvement, with a further eleven companies in Technology, Biotech and Software & Services applying to list. Technology stock activity should be a positive for the ASX, as these sectors are often comprised of larger companies. 

“Overall, there is a broader range of companies planning to list in 2018, with Real Estate, Food, Beverage & Tobacco, and Capital Goods, each having several listings in the pipeline.”