(Yicai) Oct. 20 -- During an interview about the initial public offering market on the New York Stock Exchange, Cassandra Seier, head of the bourse's international capital market, has expressed optimism about more Chinese companies carrying out IPOs there.
Below are excerpts from the interview.
Yicai: What are your thoughts about the IPO market after almost two years' freeze?
Cassandra Seier: My thought is that the IPO market is gradually opening, and we have seen healthy revival signs of companies that have come so far. And we see this across various sectors and various countries. As you know, my team and I are responsible for international capital markets at the New York Stock Exchange, which is really taking non-US companies to list here.
At the NYSE, we have already listed about 12 companies, from international to the NYSE. And in general, I think I'm excited about what is to come between now and year-end. We have several companies that are coming, hopefully between now and the end of the year, and they are of a global nature.
Yicai: Please share with us some data regarding the NYSE's performance so far this year.
Seier: For the first half of the year, the NYSE has really set the pace for IPO proceeds. We raised over USD6.7 billion in IPO proceeds, and we are involved in eight out of the 10 largest transactions. For the deals that have come out this year, over 95 percent were priced within or above the price range. Additionally, they have all traded quite well. Over 80 percent of them have traded beyond the issue price on day one. So those are healthy signs. Overall, it has been a rather busy year for the NYSE.
Yicai: The big names, such as Arm and Instacart, have gone public recently, but their valuation came in far below the expectation. Does that reflect a cautious outlook here on Wall Street?
Seier: In general, the valuation expectations from 2020 and 2021 are probably unlikely to happen again. That was a very different market environment. Now, given current market conditions, I think that there has to be some kind of equilibrium evaluation between issuers' and investors' expectations. And we saw tech companies finally come to the market after two years. Tech companies are really important in general as an indicator of investor sentiment in the IPO market. So it's good and positive to see tech companies come out.
Yicai: Market challenges, including higher rates, stubborn inflation, and recession risk, are still out there. Are those headwinds going to impact the market?
Seier: There seems to be a general market consensus that the US economy has averted a hard landing and is really showing signs of a softer landing in general. When market conditions are more stable, that's when you're going to see, hopefully, the capital markets become a viable place for companies to come and raise capital. And we thought that right now, we were closer to the tail end of the Federal Reserve hike.
Given what we have seen in the tech sector and the strong pipeline seen at the NYSE for the next 12 months, I'm really optimistic that there should be more companies that will debut in the NYSE for their capital and liquidity and funding needs.
Yicai: Let's talk about the Chinese market, which is a crucial market and also the second largest market for the NYSE. What is your outlook for Chinese companies coming back?
Seier: I think a lot has to be really dependent on the regulation process, which is quite new. We have seen a small handful of companies that have filed and have gotten approval from the regulator. So that is a positive sign. Now, we're waiting for the right market timing for those companies to come and list on the NYSE. We are hopeful between now and year-end, as we should be able to see a couple of them coming here. So we are really optimistic.
And, you know, next year is the year of the dragon. Dragon is supposed to be an auspicious year. We might see more Chinese companies come and celebrate at the NYSE to ring the bell here.
Editor: Futura Costaglione