Global law firm Reed Smith in partnership with Mergermarket, in its latest report titled 'Taking Stock: Going Public in Volatile Times' stated that businesses in Asia are confident that initial public offering (IPO) activity will see an upsurge in the coming year. The report is based on the survey of 100 C-level executives, across Asia pacific, North America and Europe. All 100 companies are considering IPO in next three years.
According to the survey 44% of Asia-based respondents expect IPO markets to return to last years' highs within a year, 11% believe markets will rebound within six months, while none expect a rebound in other regions. However, survey respondents also show caution with 70% saying the recent turmoil in Chinese equity markets has influenced their IPO strategy.
The report stated that when it comes to post-IPO challenges, 59% of survey respondents cited greater public scrutiny among their top three reservations, while nearly half that is 49% concern about their stock being subject to market volatility ranked in the top three. The report added that short-termism, shareholder pressure and the risk of litigation also ranked high in the list of reservations about being a publicly listed company. Further, Global IPO volume has fallen 38% to just 339 in the first six months of 2016, from the first half of 2015 with a total of 544.