With this year’s pace of IPOs trailing 2022’s, 2023 is likely to log a second straight year of declining US public listings. These two years have been the slowest since 2016, combining for less than a third of the record 1,035 IPOs that went ahead in 2021. Sentiment may be set to turn however, as the spate of aggressive monetary tightening that broke the back of equity market exuberance early last year may finally be set to end.
Reports have surfaced that multi-billion Dollar firms like Shein and Reddit are exploring potential IPOs in early 2024, which could very well set the tone for a recovery in public listing activity. The question remains, however, whether this is a positive signal for equities or a warning sign.
Related ETF & Stocks: Renaissance IPO ETF (IPO), Arm Holdings plc (ARM), Maplebear Inc. (CART), Birkenstock Holding plc (BIRK)
eCommerce fashion startup Shein filed to go public in the United States yesterday, recruiting Goldman Sachs, JPMorgan Chase and Morgan Stanley as lead underwriters for the IPO – expected in early 2024. If the company goes to market materially above its most recent private market valuation of $66 billion, it would be the most valuable China-founded enterprise to go public in the US, surpassing ride-hailing giant Didi Global’s 2021 debut at $68 billion. It would also be significantly larger than Arm Holdings’ public listing, the year’s largest IPO thus far, which valued the firm at $54.5 billion.
Shein’s IPO will fuel speculation that the IPO market is set to heat up in early 2024, coinciding with an expected end to monetary tightening at the Federal Reserve. Some reporting indicates that social media giant Reddit is again considering a long-anticipated public listing in Q1 of next year, holding talks with potential investors. Per TechCrunch, Reddit had previously tapped Morgan Stanley and Goldman Sachs to work on a potential listing in early 2022. At the time, it was considering a valuation of as much as $15 billion, but those plans…
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