India, Korea and Taiwan lead share sales in Asia, Korea’s FSC unveils benefits for value-up programme and insurers flock to private credit
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This week, Asia’s equity capital markets are driving the news agenda. India’s robust pipeline of IPOs is attracting more foreign funds, and has made it the second busiest market globally for ECM deals. Korea and Taiwan are also boosting share sales in the region, with more semiconductor firms in Taiwan slated to go public this quarter, driven by a demand for AI and related stocks.??
Meanwhile, South Korea’s regulator has unveiled a list of measures to improve the valuations of domestically-listed companies with the goal of ending the ‘Korea discount.’ Incentives include exemptions from strict auditor designation rules for firms with improved governance structures and tax benefits. Private credit is also heating up. A global survey of insurers managing a total of $13 trillion found that they favoured private credit as an asset class over US equities, government debt and private debt.??
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India sizzles in global equity capital markets amid Asia deals drought?
India's robust pipeline of large block trades and listings, including Hyundai Motor's $3 billion IPO, is attracting significant funds, making it the second busiest market globally for equity capital market deals. Factors like higher global interest rates and China's IPO restrictions have led to a decline in equity dealmaking across Asia, contrasting with India's surge. Indian companies raised $2.3 billion in IPOs in Q1 2024, up over 12 times from the same period last year. The National Stock Exchange ranked third globally for listings, signaling India's growing importance for global investors. Major upcoming IPOs include Hyundai Motor's India unit and Vishal Mega Mart, with deals becoming larger. Citigroup leads in Indian ECM activity, ahead of Bank of America and ICICI Bank.?
Taiwan, Korea to boost Asia share sales, says top underwriter?
More chip and semiconductor firms from Taiwan are aiming for share sales this quarter, led by Citigroup. South Korea and India are also expected to see increased activity. US banks are topping the ECM underwriting rankings for equity transactions in Asia Pacific. Taiwan's stock market is booming, driven by semiconductor stocks, providing opportunities for equity sales. South Korea's short-selling suspension until June and India's flight to quality in mid to small-cap stocks are also influencing market trends.?
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South Korea's FSC ramps up benefits to bolster corporate value-up drive?
Financial regulators in South Korea are encouraging local companies to participate in the government's initiative to bolster the country's market valuation. The Financial Services Commission announced new incentives, including exemptions from strict auditor designation rules for firms with improved governance structures. The move aims to address concerns about over-regulation and boost corporate valuation. Companies recognized in the government's "value-up program" will receive favorable evaluations and benefits such as waived fees and delayed sanctions. The announcement follows discussions between regulators and the accounting sector to enhance corporate value and advance the capital market.?
Private credit is top choice for insurers managing $13 trillion?
In Goldman Sachs Asset Management's annual survey of global insurance companies, private credit emerged as the most favored asset class for the first time, with 53% of executives ranking it among the top five for expected 12-month returns. The $1.7 trillion private credit market is expanding, despite recent scrutiny. Additionally, the majority of respondents anticipate a decline in long-term US Treasury yields and foresee the Federal Reserve cutting interest rates this year. There's also optimism regarding equities, with 84% expecting positive returns from the S&P 500 Index. Concerns vary by region, with deteriorating credit quality topping the list in the Americas and worries about higher rates in Asia. Insurers in the Americas are hedging against inflation with floating-rate securities.?
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