IPOs in Asia

BSE attracts the biggest Asian IPO in August

Sterling & Wilson Solar's flotation topped Asia's IPO deal list by value last month, according to Dealogic. But market reaction to the renewable energy company highlights concerns for its future growth.

Stock exchanges from emerging markets stood out in August with some of the month's largest IPOs.

Sterling & Wilson Solar topped the Asian IPO market with a $406 million listing on August 20 on the Bombay Stock Exchange, according to data from Dealogic.

It is the first Indian solar company to go public at a time when the Indian solar power market is quickly catching up with the rest of the world. According to research from the National Renewable Energy Laboratory, India ranked third globally last year for solar photovoltaic (PV) installation – about 8 gigawatts in total – trailing China and the US.

Another solar company, this time from Thailand, was also in the spotlight as the third-largest Asian IPO by valuation in August. Super Energy Power Plant Infrastructure Fund became the first solar infrastructure fund listed on the Stock Exchange of Thailand, with a market capitalisation at its IPO of $170 million. The company has 19 projects of PV power plants with a total capacity of 118 megawatts.

Despite a volatile stock market, the infrastructure fund IPO showed strong momentum and some remain optimistic about the emerging market.

“Thailand has been insulated from the trade war sentiment, as demonstrated by both the strengthening of the Baht and the broader market performance,” said Felicity Chan, Southeast Asia head of equity syndicate at Credit Suisse. 

“Coupled with its robust pool of domestic investor liquidity and its strong domestic consumption story, we would expect increased primary and secondary market activity – as we have already seen this year.”


The charts below are compiled using data from Dealogic as of August 30. 

Top 10 IPOs across Asia in terms of deal size in August

The stock price of Sterling & Wilson Solar, however, has not performed as expected. Its shares have dropped 16% to Rs609 ($8.46) since its debut.

“There are certain issues which may prove to be a growth impediment in the near to middle term for Sterling & Wilson Solar,” Natasha Jain Agarwal from RocSearch commented to FinanceAsia. “The solar power industry is heavily influenced by the government in India, and changes to regulations or the elimination of economic incentives in the solar power industry may have a direct impact on the business.” She added that this company is also heavily indebted, which is a big concern for investors. Most of Sterling & Wilson Solar’s projects are in the Middle East, especially in Abu Dhabi.

Share price performance since debut in descending deal size

The technology sector topped the IPO market again in August, although it has shunk 33% in market value compared to August last year. Traditional sectors such as real estate and finance all suffered as total deal value has dropped dramatically year-on-year. Investors have clearly shifted their attention to the healthcare sector. Its total deal value has almost doubled year-on-year. 

Sector Comparison


This article has been corrected in the fifth paragraph to update Felicity Chan's comment


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