The global corporations public offering (IPO) market showed signs of recovery in the first quarter of this year, but analyses suggest that market uncertainty is deepening due to increased geopolitical risks and the rapid rise of artificial intelligence (AI) technology.
Global accounting and consulting firm Ernst & Young (EY) HanYoung noted this on the 22nd through the 'EY Global IPO Trends Q1 2025' report.
According to the report, a total of 291 IPOs were completed in the global IPO market in the first quarter of this year, raising approximately $29.3 billion. The number of IPOs increased by 3% compared to the same period last year, maintaining a similar level, while the amount raised showed a recovery trend with an increase of about 20%.
By region, the Americas region raised $8.9 billion through 62 IPOs, an increase of 51% compared to the same period last year. The United States further strengthened its leadership in the IPO market with the new administration, especially as 58% of corporations listed in the U.S. were cross-border IPOs, highlighting significant global capital inflows.
The Europe, Middle East, India, and Africa (EMEIA) region recorded a total of 113 IPOs, raising $9.5 billion, reflecting decreases of 9% and 4%, respectively, compared to the same period last year. Uncertainty spread across Europe due to changes in U.S. policies, while the Middle East continued to perform well, and India, although experiencing a decrease in IPO numbers, saw a number of large IPOs succeed, thereby asserting its presence in the market.
The Asia-Pacific region has seen significant recovery, reclaiming the global lead in both IPO numbers and funds raised. A total of 116 new listings have raised $10.9 billion, which is an 87% increase compared to the same period last year. Japan recorded the largest IPO globally this quarter, and South Korea, Hong Kong, and Malaysia also demonstrated notable growth. In contrast, mainland China and Oceania showed relatively sluggish trends.
In South Korea, a total of 23 IPOs took place in the first quarter, marking a 64% increase compared to the same period last year, and this is the highest level in nearly 20 years, following 24 IPOs in the first quarter of 2021. The amount raised was $1.2655 billion, which surged 269% year-on-year.
In particular, LG CNS, which went public this quarter, ranked second in terms of funds raised among Asia-Pacific region IPOs and seventh overall in the global IPO market. As a result, South Korea ranked third in number of IPOs and ninth in total funds raised in the global IPO market for the first quarter.
The global IPO market in the first quarter has shown a mix of opportunities and risks following the policy changes that have occurred since the inauguration of the Trump administration in the U.S. With inflation expectations rising, new tariff policies are stimulating inflation both in the U.S. and globally, increasing uncertainty in monetary policy. However, the aerospace and defense sectors may see a boost in related IPO markets due to increased defense expenditure by various countries.
The EY report analyzed that AI has emerged as a new game changer in the IPO market, transcending its status as a simple technology. In fact, corporations preparing for IPOs are leveraging AI to refine market strategies, enhance operational efficiency, and maximize the prospects for success in the overall IPO preparation and execution processes. Notably, AI was most frequently mentioned in sector disclosures for technology, healthcare and life sciences, and finance, and appears to play a central role in the key narratives of recently listed corporations.
Moreover, due to the impact of market uncertainty, some corporations are reportedly adjusting their IPO schedules to the second half of this year or early next year. Corporations that went public in the first quarter are also experiencing mixed stock price trends post-listing, indicating confusion about market direction. Particularly, key stock markets in major countries have been shaken by recent tariff issues, and expectations for high valuations at the beginning of the year have somewhat weakened. However, the U.S. remains the most attractive listing destination for global corporations, and the industrial materials and aerospace and defense sectors are expected to continue growing due to a solid IPO pipeline and support from government policies, according to the report.
Park Jung-ik, Deputy Minister of Market for EY HanYoung, said, "The global IPO market in the first quarter has exhibited increased volatility and uncertainty, as geopolitical risks reconfigure the existing order and policy changes following election create a landscape for new opportunities, while technological innovation is generating turning points that exceed market expectations."
He added regarding the South Korean market, "Recently, financial authorities are enhancing capital market efficiency by announcing measures to improve IPO and delisting systems that focus on suppressing short-term trading and streamlining delisting procedures to elevate the qualitative level of the stock market. Corporations planning for IPOs need to prepare to communicate with the market around long-term vision and their unique corporate narratives, rather than short-term results, to systematically enhance corporate value."