Capital markets in emerging countries like China and India are increasingly important to the global economy, according to a survey by international law firm DLA Piper.
DLA Piper’s International Capital Markets Survey included companies listed on eight key international stock exchanges and investment banks across the world. Many respondents suggested that China and India will continue to be hotspots for capital markets in the next few years.
“It seems apparent that the emerging economies will continue to have an important influence on the direction of international capital markets,” said the survey report. “The continuing surge in activity by companies in emerging markets in Asia, Latin America, the CIS, CEE and elsewhere has played an important role maintaining a degree of buoyancy within global IPO and M&A markets over the last six month … In the short term, the benefits of the IPO trends in emerging markets are likely to be seen by the local stock exchanges in those markets.”
While familiarity with the local market continues to underpin a significant number of listing decisions in Asia, the growing internationalization of business and increasing dissatisfaction with primary listings means there may be a trend towards “exchange shopping”, or the consideration of alternative listings.
“Our findings highlight the importance to any company of giving careful consideration to its intended stock exchange and then reviewing the benefits of its listing on a regular basis,” said Esther Leung, a partner at DLA Piper’s corporate finance group.
“The feeling amongst investment bankers is that there has been increasing thought given by their clients to moving their primary listing to other exchanges, and we believe this trend will continue as businesses become increasingly global and as individual stock exchanges implement more active marketing strategies.”