Market Insights Financial Corporate Finance

Initial Public Offerings - South Africa

South Africa

The transaction value in the Initial Public Offerings market is projected to reach US$223.60m in 2024.
It is expected to show an annual growth rate (CAGR 2024-2025) of -8.50% resulting in a projected total amount of US$204.60m by 2025.
The average transaction value in the Initial Public Offerings market amounts to US$105.10m 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 South Africa is experiencing a notable surge in activity, reflecting the growing interest in investment opportunities within the region.

Customer preferences: Investors in South Africa are increasingly looking for diverse investment options beyond traditional asset classes. The appeal of Initial Public Offerings lies in the potential for high returns and the opportunity to invest in promising local companies at an early stage.

Trends in the market: One prominent trend in the South African IPO market is the rise of tech and e-commerce companies going public. As the digital economy continues to expand globally, South African investors are keen on participating in the growth of innovative tech startups through IPOs. This trend is in line with the increasing digitization of the economy and the growing demand for tech-related investments.

Local special circumstances: South Africa's unique market dynamics, characterized by a mix of developed and emerging sectors, contribute to the vibrant IPO market. The country serves as a gateway to the African continent, making it an attractive destination for companies seeking regional expansion. Additionally, the government's efforts to promote entrepreneurship and innovation further fuel IPO activities in South Africa.

Underlying macroeconomic factors: The macroeconomic landscape in South Africa, including factors such as GDP growth, inflation rates, and regulatory environment, plays a significant role in shaping the IPO market. Favorable economic conditions, coupled with political stability, create a conducive environment for companies to go public and attract investor interest. Moreover, the country's robust financial infrastructure and well-established capital markets provide a solid foundation for IPOs to thrive.

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.