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Professional rock climber Joe Kinder lunging for a hand hold on a steep over hanging rock wall while both feet are peeled away from he rock due to the difficulty of the move in South West Utah. He is high above ground and the rolling hills of the desert can be seen behind him and off in the distance.

EY Global IPO Trends Q2 2024

How can you adapt your IPO strategy in a dynamic market?

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5 minute read 26 Jun. 2024

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Global IPO divergence widens as Americas and EMEIA surge while Asia-Pacific slows.

In brief

In the first half (H1) of 2024, global IPO volumes fell 12%, with proceeds down by 16% year-over-year (YOY).
EMEIA regained the No. 1 global IPO market share by number for the first time in 16 years.
Industrials led the way in number of IPOs with technology raising the most capital.

Globally, in the first half (H1) of 2024, there were 551 listings raising US$52.2b in capital, a 12% decrease in the number of IPOs and a 16% drop in proceeds raised YOY. This result is mainly due to a slowdown in Asia-Pacific IPO activity with the Americas and Europe, the Middle East, India and Africa (EMEIA) seeing robust growth in H1. These and other findings are available in the EY Global IPO Trends Q2 2024, a quarterly report analyzing global IPO data to determine market trends and outlook for the year ahead.

The EY organization analyzed IPO data for Q2 2024 (as of 17 June plus expected deals by 30 June 2024) to identify key IPO market trends for. The analysis utilized data provided by Dealogic, S&P Capital IQ, Mergermarket and EYGS LLP. Special purpose acquisition company (SPAC) data are excluded from all data in this report, except where indicated.

The industrials sector took the lead in number of IPOs with 115 (21%) listings, primarily fueled by strong activity in India. Meanwhile, the technology sector outperformed in terms of capital raised, amassing an impressive US$10.8b (21%) in IPO proceeds, with the US securing much of these funds.

There was a leap in large Private Equity (PE)/Venture Capital (VC)-backed IPOs, with the proportion of IPO proceeds from such offerings rising from just 9% in the first half of 2023 to 41% in H1 2024. This trend was particularly pronounced in the Americas, where 74% of the IPO proceeds were from PE/VC-backed companies.

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The full EY Global IPO Trends Q2 2024 report provides deeper analysis and insights.

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Professional rock climber Joe Kinder lunging for a hand hold on a steep over hanging rock wall while both feet are peeled away from he rock due to the difficulty of the move in South West Utah. He is high above ground and the rolling hills of the desert can be seen behind him and off in the distance.

Americas and EMEIA gain ground while Asia-Pacific activity continues to slow

During H1 2024, there was a strong appetite for equity offerings in both the Americas and EMEIA regions, buoyed by favourable stock market performance, improving IPO valuation levels and growing investor enthusiasm for new offerings. In the Americas, there were 86 IPOs with proceeds of US$17.8b, an increase of 12% and 67%, respectively, YOY.

The EMEIA region has made a remarkable comeback in H1 2024, achieving its highest global market share by number since the 2008 Global Financial Crisis, accounting for an impressive 45% of total deal volume and 46% of value. This impressive performance was spurred by major European listings indicating that more larger companies perceive the current market condition as an optimal IPO window. India also experienced a significant surge, accounting for 27% (152) of global IPOs by deal volume, up from 13% (81) in the same period last year.

A series of two curved line charts showing the global IPO market share as split between the Americas, Asia-Pacific and EMEIA. The first chart shows global IPO market share by percentage of IPOs overall with a curved line for each of the three areas: Americas, Asia-Pacific and EMEIA. The Americas had the following market share by number of IPOs: 25% in 2014, 16% in 2015, 12% in 2016, 13% in 2017, 19% in 2018, 19% in 2019, 19% in 2020, 22% in 2021, 10% in 2022, 11% in 2023, and 16% in H1 2024. Asia-Pacific had the following market share by number of IPOs: 45% in 2014, 54% in 2015, 59% in 2016, 57% in 2017, 49% in 2018, 60% in 2019, 61% in 2020, 47% in 2021, 63% in 2022, 56% in 2023, and 39% in H1 2024. EMEIA had the following market share by number of IPOs: 30% in 2014, 30% in 2015, 29% in 2016, 30% in 2017, 32% in 2018, 21% in 2019, 20% in 2020, 31% in 2021, 27% in 2022, 33% in 2023, and 45% in H1 2024.

The second chart shows global IPO market share by percentage of IPO proceeds, represented by three curved lines; one each for the Americas, Asia-Pacific and EMEIA. The Americas had the following market share by proceeds: 39% in 2014, 20% in 2015, 17% in 2016, 27% in 2017, 29% in 2018, 26% in 2019, 36% in 2020, 38% in 2021, 5% in 2022, 18% in 2023, and 34% in H1 2024. Asia-Pacific had the following market share by proceeds: 32% in 2014, 44% in 2015, 54% in 2016, 39% in 2017, 48% in 2018, 45% in 2019, 51% in 2020, 38% in 2021, 67% in 2022, 56% in 2023, and 20% in H1 2024. EMEIA had the following market share by proceeds: 29% in 2014, 36% in 2015, 29% in 2016, 34% in 2017, 23% in 2018, 29% in 2019, 13% in 2020, 24% in 2021, 28% in 2022, 26% in 2023, and 46% in H1 2024.

The Asia-Pacific region, once a hotbed for IPOs, has seen its market sentiment dampened by a confluence of headwinds, including geopolitical tensions, elections, economic slowdown, heightened interest rates and a drought in market liquidity, which led to investor caution. The region witnessed a prolonged slowdown in H1 2024, with a mere 216 IPOs listed and US$10.4b raised. This lackluster performance represents a staggering decline of 43% and 73% by volume and value YOY, respectively.

Column chart showing IPO activity by geography in H1 2024, in terms of percentage change versus H1 2023. The complete data per regions showing is as follows: Globally, the number of IPOs is down 12%, with total IPO proceeds down 16%. For the Americas, the number of IPOs is up 12%, with IPO proceeds up 67%. For Asia-Pacific, the number of IPOs is down 43%, with IPO proceeds down 73%. For EMEIA, the total number of IPOs is up 46%, with total IPO proceeds up 89%.

The global IPO market reflects the broader economic backdrop, while seeking new balance amid the geopolitical and election complexities. As the pendulum of opportunity swings toward the developed Western economies, the Asia-Pacific region faces headwinds that test its tenacity. Companies contemplating IPOs need to show heightened adaptability and resilience to make well-informed strategic decisions amid the evolving IPO landscape.

IPO returns eclipse index benchmarks amid investor enthusiasm for robust market debuts

In the past two years, the IPO market has experienced a notable shift in investor focus on financial sustainability and profitability of newly listed companies, reflecting a more discerning approach in an environment characterized by tight monetary conditions and market uncertainties.

In response to this evolving investor approach, companies considering the public option are increasingly emphasizing their revenue and profitability metrics and plans for achieving sustainable growth. The net profit margin metrics of the 2023 and YTD 2024 IPO cohorts reveal noticeable improvement across most regions. In China, regulators have introduced more stringent listing requirements for IPOs in a bid to enhance the quality of companies going public and protect investor interests.

Meanwhile, the US has showcased a broader array of companies making their market debuts, ranging from nascent technology and health ventures to mature, scalable firms. This diversity has been a key factor in driving a considerable increase in the average deal value and a notable surge in the median net profit margin across the US market.

A horizontal bar chart showing the median net profit margin of IPO companies in percentages between 2023 IPOs and YTD 2024 IPOs. Globally, the median net profit margin of IPO companies was 8% in 2023 and 9% YTD 2024. In the United States, it was -5% in 2023 and 3% YTD 2024. In Europe, it was 8% in 2023 and 10% YTD 2024. In the Middle East and North Africa (MENA), it was 12% in 2023 and 17% YTD 2024. In Greater China, it was 11% in 2023 and 11% YTD 2024. In Japan, it was 7% in 2023 and 5% YTD 2024. In Asean, it was 8% in 2023 and 9% YTD 2024. In India, it was 7% in 2023 and 8% YTD 2024.

Unicorn IPO hope stirs as markets pivot from post-pandemic crunch to rate cut optimism

Unicorns, which are typically disruptive, privately held companies that are generally less than a decade old and have reached billion-dollar valuations, revolutionize markets or entire industries.

Within IPO pipelines, technology unicorns represent approximately half of the total IPO candidates, followed by financial, industrial and consumer sectors. AI unicorns have been particularly notable for significant funding rounds, as startups specializing in AI and machine learning (ML) gear up for public offerings amid rising investor interest in the field. The AI vertical's robust growth and substantial funding highlight its vital position in the current unicorn landscape, with some of them well-positioned for ongoing success and prospective IPOs in the near future.

Geographically, almost half of unicorns in the global IPO pipeline are from the US, reflecting its dominant position in the startup universe. Mainland China follows with 15%, a sign of its growing influence and the rapid development of its tech sector. India also shows a notable presence, with 7% of unicorn IPO candidates. The high concentration of unicorns in these regions indicates robust ecosystems that support innovation, funding opportunities and favorable regulatory environments, making them prime locations for startups aiming to go public.

A series of two donut charts, the first showing the unicorn IPO pipeline broken down by sector, with technology at 50%, financials at 12%, industrials at 11%, consumer at 10%, health and life sciences at 8%, media and entertainment at 3% and others at 6%.

The second donut chart shows the unicorn IPO pipeline broken down by area and region in percentages. The United States has 47%, Americas – Others has 8%, EMEIA – Others has 9%, Germany has 3%, India has 7%, the UK has 3%, Asia-Pacific – Others has 8%, and Mainland China has 15%.

Global elections amplify uncertainty over the impact of specific policies on IPOs

Just as investors and IPO candidates adapt to shifting interest rate policies, they must also cope with a complex geopolitical and election environment. This year, the political calendar is marked by elections in more than 50% of the global population accounting for nearly 60% of worldwide GDP, including many geopolitically significant regions. This amount of potential change is likely to create an exceptional level of uncertainty.

Historically, US presidential elections have had little impact on the country’s IPO activity during an election year, apart from dampening activity during the November voting months. However, in the years following elections, IPO activity has often seen a noticeable uptick, suggesting that policy changes, economic initiatives and a stabilized market sentiment can broadly contribute to a more favorable environment for IPO.

A bar chart showing the average number of US IPOs in election years, post-election years and other years, meaning not election years or post-election years. Election years show an average of 149 IPOs. Post-election years show an average of 219 IPOs. Other years show an average of 176 IPOs. The footnotes announce that the average IPO volume in election years was 15% lower than in other years, and average IPO volume in post-election years was 24% higher than other years.

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H2 2024 IPO market outlook

The second half of 2024 will be shaped by key factors affecting the global IPO market – the varying schedule of interest rate cuts, escalating geopolitical tensions, and the election super-cycle.

Global inflation continues to cool amid varying economic conditions and regional inflation levels. The central banks’ easing cycle is likely to be disjointed with some European and emerging markets leading the way, ahead of a more hawkish Federal Reserve (Fed) in the US. When central banks, including the Fed, reverse their course and start to lower interest rates, investors are expected to move their capital in search of higher returns. This shift is anticipated to increase liquidity in equity markets, emerging markets and growth-oriented sectors like technology and health and life sciences.

Geopolitical tensions could compel businesses to explore alternative IPO markets, avoiding high-risk regions and seeking more favorable regulatory environments. This shift could potentially lead to the rise of new financial hubs and alter the IPO market landscape.

Meanwhile, election-related uncertainties impact IPO timing. Some companies could postpone offerings to sidestep the unpredictable effects of electoral outcomes on market stability and investor confidence, preferring to await more stable post-election conditions.

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The EY organization analyzed IPO data for Q2 2024 (as of 17 June plus expected deals by 30 June 2024) to identify key IPO market trends for. The analysis utilized data provided by Dealogic, S&P Capital IQ, Mergermarket and EY research. Special purpose acquisition company (SPAC) data are excluded from all data in this report, except where indicated.
The data presented on this webpage and in the EY Global IPO Trends Q2 2024 press release is sourced from Dealogic, S&P Capital IQ, Mergermarket and EY analysis unless otherwise noted. The Dealogic data are under license by ION. ION retains and reserves all rights in such data. Special purpose acquisition company (SPAC) data are excluded from all data in this report, except where indicated.

Q2 2024 refers to the second quarter of 2024 and covers completed IPOs from 1 April to 17 June 2024, plus expected IPOs by 30 June 2024 (forecasted as of 17 June 2024). Q2 2023 refers to the second quarter of 2023 and covers completed IPOs from 1 April to 30 June 2023. 1H 2024 refers to the first six months of 2024 and covers completed IPOs from 1 January 2024 to 17 June 2024, plus expected IPOs by 30 June 2024 (forecasted as of 17 June 2024). 1H 2023 refers to the first six months of 2023 and covers completed IPOs from 1 January 2023 to 30 June 2023.

In compiling the IPO statistics included in these reports and press releases, we focus only on IPOs of operating companies and define an IPO as a "company's offering of equity to the public on a new stock exchange".
This report includes only those IPOs for which Dealogic and EY teams offer data regarding the first trade date (the first day on which the security start trading on a stock exchange), and proceeds (funds raised, including any over-allotment sold).
The first trade date determines which quarter a deal is attributed to. Postponed IPOs, or those that have not yet been priced, are therefore excluded. Over-the-counter (OTC) listings are also excluded.
In an attempt to exclude non-operating company IPOs such as trusts, funds and special purpose acquisition companies (SPACs), companies with the following Standard Industrial Classification (SIC) codes are excluded:
6091: Financial companies that conduct trust, fiduciary and custody activities.
6371: Asset management companies such as health and welfare funds, pension funds and their third-party administration as well as other financial vehicles.
6722: Companies that are open-end investment funds.
6726: Companies that are other financial vehicles.
6732: Companies that are grant-making foundations.
6733: Asset management companies that deal with trusts, estates and agency accounts.
6799: Special purpose acquisition companies (SPACs).
Africa includes Algeria, Botswana, Egypt, Ghana, Kenya, Madagascar, Malawi, Morocco, Namibia, Rwanda, South Africa, Tanzania, Tunisia, Uganda, Zambia and Zimbabwe.
Americas includes Argentina, Bermuda, Brazil, Canada, Chile, Colombia, Ecuador, Jamaica, Mexico, Peru, Puerto Rico and the United States.
ASEAN includes Brunei, Cambodia, Guam, Indonesia, Laos, Malaysia, Maldives, Myanmar, North Mariana Islands, Philippines, Singapore, Sri Lanka, Thailand and Vietnam.
Asia-Pacific includes ASEAN (listed above), Greater China (as stated below), Japan, South Korea, Australia, New Zealand, Fiji and Papua New Guinea.
EMEIA includes Armenia, Austria, Bangladesh, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, India, Ireland, Isle of Man, Italy, Kazakhstan, Luxembourg, Lithuania, Netherlands, Norway, Pakistan, Poland, Portugal, Russian Federation, Spain, Sweden, Switzerland, Turkey, Ukraine and United Kingdom plus the Middle East countries (listed below) and Africa countries (listed above).
Greater China includes Mainland China, Hong Kong, Macau and Taiwan.
India region includes IPO activity in Indian and Bangladesh stock exchanges.
Middle East includes Bahrain, Iran, Israel, Jordan, Kuwait, Oman, Qatar, Saudi Arabia, Syria, United Arab Emirates and Yemen.
Sectors are classified according to Thomson general industries using a company’s Sector Industry Classification (SIC) code. There are 11 sectors, which are defined below with their specific industries. The 11 sectors are shown on the horizontal axis.

Consumer includes the combination of “Consumer staples” and “Consumer products and services” sectors. Its specific industries include: agriculture and livestock, food and beverage, household and personal products, textiles and apparel, tobacco, educational services, employment services, home furnishings, legal services, other consumer products, professional services, as well as travel services.
Energy industries include alternative energy sources, oil and gas, other energy and power, petrochemicals, pipelines, power, as well as water and waste management.
Financials industries include asset management, banks, brokerage, credit institutions, diversified financials, government sponsored enterprises, insurance, as well as other financials.
Health and life sciences industries include biotechnology, health care equipment and supplies, health care providers and services (HMOs), hospitals, as well as pharmaceuticals.
Industrials industries include aerospace and defense, automobiles and components, building/construction and engineering, machinery, other industrials, transportation, as well as infrastructure.
Materials industries include chemicals, construction materials, containers and packaging, metals and mining, other materials, as well as paper and forest products.
Media and entertainment industries include advertising and marketing, broadcasting, cable, casino and gaming, hotels and lodging, motion pictures or audio visual, other media and entertainment, publishing, as well as recreation and leisure.
Real estate industries include non-residential, other real estate, real estate management and development, as well as residential.
Retail industries include apparel retailing, automotive retailing, computers and electronics retailing, discount and department store retailing, food and beverage retailing, home improvement retailing, internet and catalogue retailing, as well as other retailing.
Technology industries include computers and peripherals, electronics, internet software and services, IT consulting and services, other high technology, semiconductors, as well as software.
Telecommunications industries include other telecom, space and satellites, telecommunications equipment, telecommunications services, as well as wireless.

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Summary

The global IPO market has continued to diverge, with EMEIA and the Americas surging while Asia-Pacific slows. IPO returns eclipse index benchmarks amid investor enthusiasm for robust market debuts. The financial sector leads in growth, while hopes for unicorn IPOs rise with more interest rate cuts on the horizon. Global elections amplify uncertainty, while geopolitical dynamics bring both challenges and opportunities.

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