After an abysmal year in a context of rising interest rates, falling markets and economic uncertainty, IPOs are starting up again on Wall Street, even if caution is still in order.
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| A stockbroker from New York. Photo: Xinhua/VNA/CVN |
A market “who stopped”. This is how Renaissance Capital describes the 2022 vintage of “IPOs”, the introductions on the New York market, with only 7.7 billion USD raised, down 95% and at the lowest for 31 years that the firm has measured this activity.
At the start of 2023, the fear of a deterioration in the economy remains relevant and the American Central Bank (Fed) is not done with its monetary tightening, but the sector has experienced a tremor this week, with two notable IPOs.
The solar panel management software specialist Nextracker has raised 638 million USD for its IPO on the Nasdaq Stock Exchange, nearly 20% more than the maximum amount initially hoped for by the Fremont (California) start-up.
Another newcomer, maker of laser sensors for autonomous vehicles Hesai, made the best New York entry for a Chinese company in 18 months, raising $190 million from investors.
“We are still well below historical averages, but since the start of the year, we have seen a rebound”confirms Avery Spear of Renaissance Capital.
“Last year, people were risk averse and introductions are inherently riskyshe explains, but now investors are getting back into it.”
“There is a lot of capital looking for an investment, but the examination (of companies applying for an IPO) going to be more in-depth and the bar will be higher”says Mark Roberts, du cabinet de conseil The Blueshirt Group.
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| At New York Stock Exchange. Photo: Reuters/VNA/CVN |
“Get Ready”
Some 293 files are currently registered with the regulator for an introduction, or 39% more than the previous year at the same time, said a spokesman for the Nasdaq.
Among them are still none of the heavyweights that operators hope to see make their debut this year.
The names of the Internet payment specialist Stripe, recently valued at $63 billion, the sports merchandising giant Fanatics (31 billion) or the shopping delivery platform Instacart (10 billion) are circulating.
For Mark Roberts, it will take a few big names to launch for the market to restart completely.
As Nextracker’s successful debut showed, renewable energy is on the rise, thanks in part to the passage in Congress of the so-called Inflation Reduction Act (IRA), with nearly 400 billion USD devoted to the energy transition and the fight against climate change.
He also mentions the “fintech”emerging innovative internet financial services companies, such as Stripe.
Fleeing in 2022, the technology sector is no longer a pariah and can hope to access the stock market soon, provided that valuations are revised significantly downwards.
“The figures we saw in 2021 are ancient historysouligne Avery Spear. The time for easy money is behind us.”
The media hysteria that followed the launch of the now famous chatbot ChatGPT could have benefited the middle of artificial intelligence (AI), “but I don’t know of any AI companies ready to go public”.
Despite the animation that is currently resuming in the IPO market, a real rebound will only be possible once the market is convinced that the Fed is over with its monetary tightening cycle, warned Jeffrey Solomon of the company at the start of the year. financial Cowen.
However, several members of the institution warned this week that the rate hikes could last longer than expected.
“Market conditions can change very quickly”, says Avery Spear. A move in Fed rates or “drastic changes” in the economy “could close, again, the IPO market”.
“The majority of people on Wall Street I talk to believe in a more conducive environment for second-half IPOs.reports Mark Roberts. But a minority think the window might only be open for a few months. So get ready.”
AFP/VNA/CVN
