Market Insights Financial Corporate Finance

Initial Public Offerings - Japan

Japan

The transaction value in the Initial Public Offerings market is projected to reach €3.57bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2025) of -0.84% resulting in a projected total amount of €3.54bn by 2025.
The average transaction value in the Initial Public Offerings market amounts to €44.03m in 2024.
From a global comparison perspective, it is shown that the highest transaction value is reached in China (€58,730.00m in 2024).

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Analyst Opinion

The Initial Public Offerings market in Japan has been experiencing a significant uptick in activity in recent years.

Customer preferences: Investors in Japan have shown a growing interest in IPOs, seeking opportunities to diversify their portfolios and capitalize on the potential for high returns. With a strong culture of saving and investing, Japanese retail investors are increasingly participating in IPOs, contributing to the market's expansion.

Trends in the market: One notable trend in the Japanese IPO market is the increasing number of tech companies going public. As Japan aims to strengthen its position in the global tech industry, many tech startups are choosing to launch IPOs to raise capital for expansion and innovation. This trend reflects the growing importance of technology in the Japanese economy and investor appetite for high-growth sectors.

Local special circumstances: The unique regulatory environment in Japan plays a crucial role in shaping the IPO market. Stringent listing requirements set by the Tokyo Stock Exchange ensure that only companies with strong financials and corporate governance practices can go public. This emphasis on quality and transparency provides investors with a sense of security and contributes to the overall stability of the market.

Underlying macroeconomic factors: Japan's economic landscape, characterized by low interest rates and ample liquidity, creates a favorable environment for IPOs. Companies looking to raise funds through public offerings can benefit from the availability of capital at lower costs, encouraging them to pursue IPOs as a strategic financing option. Additionally, the government's efforts to promote entrepreneurship and innovation further support the growth of the IPO market in Japan.

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.