IPO market hit by broader market downturn

The initial public offerings (IPO) market in Australia had a strong start to the year, continuing the trend in 2021; however the past few months has seen the environment for new listings become significantly more challenging. HLB Mann Judd’s report analyses IPO activity over the first six months of the year on a number of key metrics.

IPO Watch Australia Mid-Year Report Summary 

  • 59 new listings on the Australian Securities Exchange (ASX) in the first six months of 2022
  • IPOs raised $790 million compared to $2.9 billion in the first six months of 2021
  • Total amounts raised were impacted by the lack of *large caps listing in 2022
  • Average first day gains of 18%, however only 35% of listings went on to make a period end gain
  • New listings in the Materials sector dominated the market, representing 44 out of 59 new entrants
  • 71% of new listings came from Western Australia.

* Large cap companies are defined as those with a market capitalisation in excess of $100 million. Small cap, companies are defined as those with a market capitalisation of $100 million or less. All data excludes property trusts. 

About IPO Watch Australia

First published in 2004, IPO Watch Australia is a benchmarking-based report. The research, led by HLB Mann Judd Perth, analyses Australian listing activity. The primary report is released in January each year, analysing IPO activity over the previous 12-month period. A short-form report is published in July and it focuses on market activity for the first six months of the year (IPO Watch Australia Mid-Year Report). The reports are authored by Corporate & Audit Services Partner, Marcus Ohm.

This year's IPO Watch Australia Mid-Year Report includes commentary and data analysis on the following:

  • Share price performance;
  • Sector analysis;
  • IPO subscription rates;
  • Review of activity for the first two quarters of the year; and
  • Market outlook for the remainder of 2022.
"We expect that macroeconomic and capital market conditions will continue to impact the IPO market in the second half of 2022. The pipeline at the end of June 2022 reflects uncertain market conditions with only 15 floats preparing to list, for a total of $121 million."
Marcus Ohm
Corporate & Audit Services Partner

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    Key findings

    New challenges ahead for the market

    The Q2 2022 saw more listings than Q1, with a total of 34 listings compared to 25. Macroeconomic and capital market conditions will most likely impact the IPO market in the second half of the year.


    A fall in sector diversity

    Only 10 industries recorded new market entrants. A significant fall in representation, compared to the 17 sectors represented in the first six months of 2021. Listings were dominated by the resources sector (materials and energy companies).


    Difficult conditions for new entrants

    34 out of 59 listings recorded a first day gain representing 58% of companies. However, listings generally struggled to sustain initial first day gains and only 32% of companies achieved a period end gain.

    ¹Average gain/loss relative to listing price for all new IPOs listed in the respective period.


    Fall in subscription rates during 2022

    The first six months of 2022 experienced a fall in the number of companies achieving their target subscription amount. Of the 59 listings in the period, only 73% of companies achieved their target compared to 87% in the same period in 2021. However, 98% of total funds sought were raised which is similar to the prior year (99%).

    IPO Percentage of Subscription Targets Achieved