TAIPEI: Initial public offering (IPO) activity in Taiwan in the first half of this year was unfazed by the sluggish global economy, with five more IPOs taking place compared with the same period last year, according to a report issued by Ernst and Young Taiwan last week.
The local capital market has seen a total of 27 IPO deals so far this year, mainly from technology, manufacturing and tourism industries, raising NT$9.45 billion (US$293.31 million) on the open market, the report said.
Ernst and Young’s figures showed that Cayman Engley Industrial Co Ltd, an automobile parts manufacturer, raised the highest amount of capital during the first half with NT$1.47 billion.
Chunghwa Precision Test Tech Co, which provides specialized printed circuit boards (PCBs) for semiconductor testers, followed with NT$1.175 billion in the first half, while Dr Wu Skincare Co Ltd, a beauty products supplier, recorded the third-largest IPO with NT$872 million, figures showed.
Despite a higher number of IPO deals in the first half, the total amount of capital raised by the deals declined by 28.8 percent from the same period last year, the report said.
“The sluggish global economy and the market corrections in Europe and the US in the run-up to the UK’s vote on EU membership have made people hesitate to invest more,” Ernst and Young’s managing partner Kim Chang told a news conference on Thursday.
In the second half of the year, the Taiwan High Speed Rail Corp is expected to join the stock market, but the majority of companies aiming to raise funds on the open market would still be those from the technology and manufacturing industries, Ernst and Young said, adding that the biotechnology industry is going to be the next major player in the IPO market.
Ernst and Young predicted that 50 IPO deals might take place in the entirety of this year, raising an estimated NT$20 billion in total capital.
Last year, Taiwan saw 52 IPO deals raising a total capital of NT$37.42 billion.
Chang said that global economic uncertainties — such as the slowdown in the Chinese economy, the potential interest rate hikes by the US Federal Reserve and the effects of Brexit — would be crucial for the local IPO market.
