Market Insights Financial Corporate Finance

Initial Public Offerings - Indonesia

Indonesia

The transaction value in the Initial Public Offerings market is projected to reach US$1.78bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2025) of -9.55% resulting in a projected total amount of US$1.61bn by 2025.
The average transaction value in the Initial Public Offerings market amounts to US$26.02m in 2024.
From a global comparison perspective, it is shown that the highest transaction value is reached in China (US$63,330.00m in 2024).

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Analyst Opinion

The Initial Public Offerings market in Indonesia is experiencing a significant growth trajectory.

Customer preferences: Investors in Indonesia are showing a strong preference for investing in Initial Public Offerings (IPOs) as a means to diversify their investment portfolios and capitalize on the potential high returns associated with new listings. This trend is in line with global investor behavior, where IPOs are often seen as an attractive investment opportunity due to the potential for significant capital appreciation in the early stages of a company's public debut.

Trends in the market: One prominent trend in the Indonesian IPO market is the increasing number of tech companies choosing to go public. This trend mirrors the global surge in tech IPOs driven by the rapid digital transformation and technological advancements across various industries. Investors are keen on participating in the growth potential of tech companies, especially in emerging markets like Indonesia where the tech sector is poised for substantial expansion.

Local special circumstances: Indonesia's growing middle class and increasing internet penetration rate have created a conducive environment for tech companies to thrive, leading to a surge in tech-focused IPOs. Moreover, the government's initiatives to support the digital economy and innovation ecosystem have further fueled the interest in tech IPOs among local investors. This unique blend of market dynamics and government support is propelling the growth of the IPO market in Indonesia, particularly in the tech sector.

Underlying macroeconomic factors: The overall economic stability and positive GDP growth in Indonesia are providing a favorable backdrop for companies looking to go public. The country's robust economic fundamentals, coupled with a young and tech-savvy population, are attracting both domestic and foreign investors to participate in the Indonesian IPO market. Additionally, the government's efforts to improve the ease of doing business and attract foreign investment are boosting confidence in the market, driving more companies to consider IPOs as a viable fundraising option.

Methodology

Data coverage:

Figures are based on the revenue generated by the Investment Banking market, as well as the transaction value, the number of transactions, and the average transactions size of the Mergers and Acquisitions (M&As) and Initial Public Offerings (IPOs) markets.

Modeling approach / Market size:

Market sizes are determined by a bottom-up approach and are based on a specific rationale for each market. As a basis for evaluating markets, we use market research and analysis, as well as data from annual financial reports. Furthermore, we use relevant key market indicators and data from country-specific associations and national data bureaus, such as GDP, wealth per capita, and total investment (% of GDP). This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are GDP per capita and total investment (% of GDP).

Additional Notes:

The market is updated twice per year in the event that market dynamics change.