As Dentons noted back in April, the number of Canadian companies seeking to go public is continuing to rapidly increase, and on pace to reach record levels by the end of this year.

Eric Lung, Danny Wakeling, Ora Wexler and Bennett Wong recently spoke with Lexpert about how investors can take advantage of the country’s IPO resurgence.

“In our view, there are several factors fuelling the IPO trend. Raising capital in public markets is becoming less expensive than in private markets. Many retail investors, having spent less during the COVID-19 pandemic, are deploying some of those savings, thus driving more buoyant markets. Increased usage of online brokerage platforms has made participation in capital markets more accessible and has fuelled interest from younger investors seeking high-growth opportunities. Also, low yields on debt and easy monetary policy are making equities more attractive.”

In regards to what industries are thriving with IPOs, the partners noted: “Not surprisingly, the technology sector has been one of the areas leading the pack in IPOs during the first half of 2021. As of May 31, 2021, 10 of the 20 TSX-listed IPOs involved technology companies. The COVID-19 experience has changed the way we live and work. Most of those changes are predicated on the adoption and evolution of modern technologies, such as AI, autonomous vehicles, AgTech and HealthTech, which could permanently reshape the future of our economy.”

As for predictions for the rest of the year: “Subject to increased vaccination rates across the country, the reopening of major Canadian business hubs and generally getting COVID-19 under control, we are cautiously optimistic that the momentum we have seen in the first half of 2021 will sustain throughout the rest of the year. We already have a number of IPOs in the pipeline set to launch in the near future, but we are also keeping an eye on new issues that have been postponed such as Q4 Inc. Although technology will remain the darling, we will likely see a more diversified group of industry sectors going public.”

To learn more about current IPO trends and for more information, visit the Dentons Going Public in Canada Resource Centre. You can access Lexpert’s full article here.

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