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China asserts itself in the 2018 US IPO market

October 4, 2018

This is an excerpt from our 3Q 2018 Quarterly Review. To read the rest of the report, sign up for a free 7-day trial of IPO Pro, the single most effective IPO data platform.

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More Chinese companies went public in the US than any quarter since the 2Q14. In the past decade, only two previous quarters were in the double digits. The 10 deals raised $3.3 billion, accounting for almost 20% of quarterly deal count and 30% of proceeds. Tightening credit and liquidity in China likely caused more domestic companies to seek out the US bull market.

Third Quarter Chinese IPOs

Despite China's trade spat with the US and broad declines in the country’s stock market, Chinese companies completed all attempted offerings. All seven of the September deals downsized the offering when they set terms, and a number placed a significant amount of the IPO with insiders or a few large accounts. Most combined extreme growth and losses, and had volatile initial trading. All but two had a positive debut, and combined with Qutoutiao's (QTT) fleeting pop, they averaged a 20% return on day one, but just 1% at quarter-end.

Several more IPOs are in the IPO pipeline heading into the 4Q18, including two lenders, an e-scooter manufacturer and a casino operator.

The IPO market hit a four-year record in the 3Q18, but the year-to-date count is even more impressive: 23 Chinese companies have gone public during the first three quarters of 2018, more than any full-year total since 2010.