With biggest initial public offerings (IPOs) happening south of the border recently, how was Canadian IPO market doing for the first nine months of 2023?
According to Canadian Financings, the situation for Q3, 2023 has not improved much from that of the first half of 2023. In Q3, 2023, 9 IPOs completed on Canadian exchanges, 1 IPO on the CSE, 8 IPOs on the TSX Venture Exchange (TSX-V). Only one out of 8 TSX-V IPOs was non-Capital Pool Company (CPC) IPO.
Canadian IPO market remains dormant
| All IPOs | Q1, 2023 | Q2, 2023 | Q3,2023 | Total | ||||
| # IPOs | $ M | # IPOs | $ M | # IPOs | $ M | # IPOs | $ M | |
| CSE | 8 | 9.5 | 4 | 3.7 | 1 | 0.2 | 13 | 13.3 |
| TSX-V | 11 | 5.6 | 10 | 3.3 | 8 | 6.5 | 29 | 15.4 |
| TSX | 1 | 150.0 | 0 | 0.0 | 0 | 0.0 | 1 | 150.0 |
| Total | 20 | 165.1 | 14 | 6.9 | 9 | 6.7 | 43 | 178.7 |
| Non-CPC/SPAC | Q1, 2023 | Q2, 2023 | Q3,2023 | Total | ||||
| # IPOs | $ M | # IPOs | $ M | # IPOs | $ M | # IPOs | $ M | |
| CSE | 8 | 9.5 | 4 | 3.7 | 1 | 0.2 | 13 | 13.3 |
| TSX-V | 0 | 0.0 | 0 | 0.0 | 1 | 3.1 | 1 | 3.1 |
| TSX | 1 | 150.0 | 0 | 0.0 | 0 | 0.0 | 1 | 150.0 |
| Total | 9 | 159.5 | 4 | 3.7 | 2 | 3.3 | 15 | 166.4 |
Virtually dormant IPO market not due to demand
Canadian IPO activities or inactivities may haven been attributed to jittery demands for Canadian IPOs. Nothing could be far from the truth. On the opposite, Canadian investors have healthy demand for US and international IPOs.
Canadian investments in US and international IPOs
| # IPOs** | CDN Investments ( CDN $M) | |
| Q1 2023 | 8 | 63.6 |
| Q2 2023 | 4 | 301.7 |
| Q3 2023* | 6 | 142.4 |
| Total | 18 | 507.7 |
* incomplete due to late filings
** Out of the 18 IPOs, 14 were completed on NASDAQ and NYSE; excluding 2 SPAC IPOs for investments of $101.8 million
Canadian Financings has yet have the information on Canadian investments in the three biggest IPOs in US in September, Arm, Instacart, Klaviyo. It may be due to late filing or may due to the inability of Canadian investors buying the IPO shares.
It should be noted that Canadian investors collectively invested $609.5 million in US and international IPOs including SPAC IPOs, 3.4 times of total amount raised from all Canadian exchange IPOs.
There should be no doubt about Canadian investors’ demand.
Virtually dormant IPO market due to lack of potentially good companies in pipe line
Two of biggest IPOs in 2023 are Lithium Royalty’s $150 million IPO on TSX and US Goldmining’s US $20 million IPO on NASDAQ.
With the investment rush into lithium and gold sectors, how have they been performing?
Unless financially strong companies come onto the IPO radar, Canadian IPO market will continue to lag behind.
Canadian Financings
Canadian Financings, a service of CPE Analytics, is Canada’s all financings database covering private (VC, PE, private exempt and non-exempt) and public financings by both Canadian and foreign firms, IPOs, M&As, fundraisings by, both Canadian and foreign, professional VC/PE firms, non-investment fund issuer funds, and investment funds.
We track and provide comprehensive analysis on Canadian IPOs both on Canadian and US/International exchanges. We are Canada’s only data provider that tracks Canadian investments in US and international IPOs.
photo credit: Yahoo! Finance, CPE News