This year’s IPO would not be a country with brimming global tech giants or the top 10 global economies by size, it is Indonesia. It is a collection of islands with huge populations and a fast-growing economy. It sits on vast deposits of the metals for batteries for electric vehicles.
This made the country an important engine of the global green transition and desirable for investors. Apparently, the Southeast Asian countries currently rank as the world’s fourth-largest market for newly listed companies. Based on Dealogic data, it measured by the amount of capital raised. It puts behind leader China, the United States and United Arab Emirates.
The country has overtake Hong Kong, the top IPO markets, for the first time since 1995. It outspaces economic powerhouses in India, South Korea and Japan. Data provider Dealogic, Perris Lee focusing on Asian equity and capital markets said that it is not normal. This year he told the media that this year will be the best year for Indonesia, ever. So far, investors have poured $2.1 billion into Indonesan IPOs, Lee said. That’s not all the country has raised as much as $2.2 billion over the whole of 2022. Then, at keast five more major IPOs are set to come in 2023.
Indonesia’s IPO performance is successful because IPO has been tough elsewhere. Due to the rise of interest rates and cost of capital, investors have pulled back from equity markets over the past year. The U.S. IPO is often the world’s largest. But now The U.S. suffers from the reliance on particularly rate-sensitive tech-companies.
Meanwhile, in Hong Kong, poor valuations and the legacy of strict Covid lockdowns make it challenging. In Indonesia however, the country shows strong fundamental advantages. Many companies go public are metal producers. The country accounts for nearly a quarter of the world’s nickel reserves equaled only by Australia’s riches.
