Given the relatively low number of listings during 2024, it is interesting to look back a few years and examine how IPOs have performed relative to the wider market.
The ASX All Ordinaries index tracks the 500 largest companies listed on the ASX according to their market capitalisation and is generally considered as a benchmark index to gauge the performance of the broader Australian stock market.
Over the past four years, from 2021 to 2024, this index has grown 23% to 8,421 points.
Chart A shows the market value of the companies that listed from 1 January 2021 through to 31 December 2023 (excluding the Materials sector), together with the market capitalisation of these companies as at 31 December 2024.
Each cohort of IPO has then been compared against the ASX All Ordinaries index growth from the midpoint (1 July) of each year through to 31 December 2024.
This analysis shows that the 2021 and 2022 new entrants have, on average, underperformed against the ASX, whilst the cohort from 2023 slightly exceeded the average market return.
It also shows that companies have been on an improving trajectory across the period from 2021 to 2023, following declines in 2021 and 2022.
The IPOs of 2021, which accounted for the largest number of transactions and the highest aggregated market capitalisation during the period, experienced an 11% decline in market capitalisation from listing date to 31 December 2024, primarily driven by a handful of large but poorly performing companies. Of the 84 IPOs in this category in the year, 32% are currently ahead of their listing valuation, and 24% have outperformed the ASX benchmark increase of 11%.
The Pharmaceuticals, Biotechnology & Life Sciences sector performed strongly in 2021 off the back of the COVID-19 pandemic, with the top four performing IPOs coming from this sector. Clarity Pharmaceuticals Ltd (ASX: CU6), a developer of oncology related radiopharmaceuticals products, grew by 498% from its IPO in August 2021 through to the 31 December 2024 reference date. Clarity was closely followed by Argenica Therapeutics Limited (ASX: AGN), a developer of neuroprotective therapeutics to reduce brain damage after strokes and other brain injuries, which grew 493% since its IPO in June 2021.
There were far fewer IPOs in 2022 than the previous year, with a total of 24 (excluding Materials listings) – a reduction of over 71% from 2021 and therefore a far lower combined market capitalisation. This cohort of new listings also experienced a decline in value from listing through to 31 December 2024, albeit by a lesser amount of 5%. Of these, 17% are currently valued above their listing price, and 13% have outperformed the ASX All Ordinaries return of 25% over the same period.
The top performing company in 2022 was Chrysos Corporation Limited (ASX: C79) which listed in May of that year. Chrysos is a software company that creates technology solutions for the global mining industry, and grew 55% across the reference period by supporting the strong performing Australian Materials sector.
The 2023 cohort of new entrants to the market outperformed the ASX All Ordinaries index with growth of 20%, compared to ASX growth of 14%.
Over half (5) of the year’s nine IPOs have shown growth from their IPO date valuation, with all of them also outperforming the market-wide benchmark of 14%.
2023 was another year in which the pharmaceutical and healthcare sectors dominated, with LTR Pharma Limited (ASX: LTP) listing in December 2023 and increasing 341% by 31 December 2024.
The Materials sector
The Materials sector has been split out due to the specific nature of this sector compared to others, often with greater fluctuations and less predictability over future performance.
Chart B shows the market capitalisation of each cohort of Materials IPOs from the past three calendar years, at both IPO close date and at 31 December 2024. It also shows the growth in market capitalisation across the periods for each cohort of listings, compared against the ASX All Ordinaries index growth from the midpoint (1 July) of each year through to 31 December 2024.
When comparing the market capitalisation of both of the past two years cohort of IPOs in that sector, each of the past three years have shown positive growth, albeit by amounts varying from 2% to 72%, following a 33% decline in 2021.
Highlighting the fluctuations in this sector, the IPO cohort from 2023 grew by just 2% by 31 December 2024, significantly underperforming compared to the index during the same period. In contrast, Materials IPOs from 2022 grew by an impressive 72%, far exceeding the market-wide growth of 25%.
Of the 107 Materials IPOs in 2021, 20% have grown as at 31 December 2024 and 19% outperformed the ASX All Ordinaries.
2022 was a better year for new entrants in the Materials sector, following average growth of 72% across the cohort. This contrasts with only 29% of IPOs having grown by the reference date of 31 December 2024, as a small number (18%) of strong performers have outperformed the market wide index. This is a theme again repeated in 2023, where the cohort of 23 IPOs grew by 2% yet only five (22%) of these ended in the positive by 31 December 2024, though each of those also outperformed the ASX index for the same reference period.
The top seven Materials IPOs across 2021 to 2023 were all related to natural resources extraction and development. The most signifi cant growth came from WA1 Resources Ltd (ASX: WA1), a gold and copper exploration company which listed in 2022 at a market capitalisation of $9.9 million and grew to $1.085 billion by 31 December 2024.
This is followed by Chilwa Minerals Ltd (ASX: CHW), an advanced stage heavy mineral sands exploration project, which has grown 4,602% since listing in July 2023, and Andean Silver Limited (ASX: ASL), a gold and silver exploration project which listed at $7.4 million in September 2021, and has grown by 2,117% to $163 million market capitalisation by 31 December 2024.
This article was first published in the 2025 IPO Watch Australia Report.