27 Jan 2021
Posted in Thematic Research
TMT IPO market set for strong 2021 after shrugging off impact of COVID-19
The tech, media, and telecom (TMT) IPO market is set for a strong 2021 after being largely unaffected by the COVID-19 pandemic in 2020, says GlobalData, a leading data and analytics company.
The company’s latest report, ‘Tech, Media and Telecom IPO Themes – Thematic Research’, reviews the IPOs of 771 TMT companies held between 2018 and 2020. The report reveals that in 2020, 323 TMT companies completed IPOs. Total proceeds stood at $96.8bn, up by 67% from 2019. The US dominated the market, accounting for 61% of total IPO proceeds.
While the pandemic’s initial impact reduced the number of TMT IPOs between March 2020 and May 2020 to just 34, market sentiment had improved by June, and the IPO market began to rebound. In the second half of 2020, the TMT IPO deal count increased to 222, which was 120% more than the first half of the year.
GlobalData’s research shows that the most lucrative themes for investors in TMT IPOs over the last three years were collaboration tools and cybersecurity. By contrast, the themes that generated the worst investor returns included internet TV, quantum computing, and blockchain.
Swati Verma, Associate Project Manager for Thematic Research at GlobalData, comments: “Strong activity in the TMT IPO market in the second half of 2020 indicates investors’ willingness to put the pandemic behind them. Corporates and consumers have accelerated their use of digital tools and platforms. That is why ecommerce, gaming, and fintech have been associated with successful equity capital raisings.
“GlobalData believes that the same themes will continue to be popular in 2021. There are some big-ticket IPOs planned for 2021, and we will watch with interest the preparations of companies, such as DiDi Chuxing, JD Logistics, Flipkart, Roblox, Playtika, Gameworks, Ant Group, Robinhood, China, Affirm, Paysafe and SoFi.”