The Brazilian Capital Market: recent developments and trends Cristiana Pereira Feb-9-12
The Brazilian exchange has become one of the top capital raising markets… Capital raised by share issues (BRL billion) 149 149 149 149 , , , , 2 2 2 2 IPO: 11 IPO: 64 Follow on: 11 Follow on: 12 74 , 81 IPO: 6 Follow on: 18 IPO: 26 IPO: 7 Follow on: 16 IPO: 11 Follow on: 8 70 70 70 70 , , , , 1 1 1 1 Follow on: 11 IPO: 4 11 , 2 Follow on: 8 45 45 45 45 , , , , 9 9 9 9 IPO: 9 Follow on: 10 34 34 34 34 , , , , 3 3 3 3 55 , 6 30 30 30 30 , , , , 4 4 4 4 23 , 7 63 , 2 7 , 5 17,8 13 13 13 13 , , , , 9 9 9 9 15 , 4 8 8 8 8 , , , , 8 8 8 8 26 , 8 7 , 1 5 , 4 15 , 1 14 , 5 4 , 5 22 , 2 10 , 7 8 , 5 4 , 3 2004 2005 2006 2007 2008 2009 2010 2011 Follow - On IPO Parcel related to the onerous cession - Petrobras offer Souce: BM&FBOVESPA. 2010 – Petrobrás – biggest public offering in the world: in Brazil
... built with a creation of special Corporate Governance segments • Goal: reduce the distance between the regulation and the necessity to protect investors • Main requirements of Novo Mercado: • Requirements of Corporate Governance: shareholders rights, transparency and supply of mandatory information • Adhesion to Market Arbitration Chamber to solve corporate conflicts • Requirement to listing maintenance IPOs by Listing Segment* • Novo Mercado is a private initiative, based BDR on the self-regulation power of the 6% Nível 1 6% Exchange, in order to improve the quality of Nível 2 public companies and the credibility of 13% capital market • It creates a receptive environment for Novo Mercado public offerings 75% *Data from 2004 to July-07-2011.
Corporate Governance Index compared to IBOVESPA 9.000 8.000 IGC 7.000 Ibovespa 6.000 5.000 4.000 3.000 2.000 1.000 - (Base 1.000 - desde 25/06/2001) – fonte: BM&FBOVESPA IGC IBOV Índices -2,32% -3,43% Jun/2011 -7,08% -9,96% Em 2011 +608,90% 329,77% Desde 2001
Broader range of sectors % of the market capitalization – January/12 Capital Goods 1,7% Information of Consumer Cyclical Sector Indexes Construction and Technology 4,1% Transportation 0,4% 4,7% • TelecomSector Index – ITEL Telecommunications 6,3% Financial 26,4% • Electric Power Index – IEE Public Utilities 9,9% • I ndustrial Sector Index – INDX Basic Materials Oil, Gas and Biofuels • Consumption Index – ICON 15,0% 16,5% • Real Estate Index – IMOB Consumer Non Cyclical 15,1% • Financial Index – IFNC New sectors (since 2004): car rental, information technology, toll roads and highways, pharmaceutical products, agriculture, sugar and alcohol, residential building construction, property agency, education services, medical services and stock exchange
Growing Private Equity Industry in Brazil PDG, GVT, Anhanguera, Even, Aliansce, BR Propert, Br Malls, Fer Heringer, Mills, HRT, Raia Vivax, Gafisa, Metalfrio, Bematech, R$5,39 Bilhões Equatorial,CSU, Cremer, MRV, Brasilagro, 8 80 Springs, Providencia, Lupatech, Abyara, Volume (US$ Billions) 68 Number of trades 7 Multiplan, Satipel, 70 Odontoprev, Tivit, Cetip, Submarino, Laep, Tempo Part Gol, Dasa, ALL Dufrybras 6 60 Direcional Localiza, R$9,69 Bilhões R$1,90 Bilhões R$4,90 Bilhões R$1,62 Bilhões 5 50 Tam, Uol Le Lis Blanc R$1,91 Bilhões R$0,15 Bilhões 33 4 40 32 31 29 7,2 3 23 30 15 2 20 2,9 2,3 1 10 2 1,3 0,1 0,5 0 0 2004 2005 2006 2007 2008 2009 2010 Volume (US$ Bilhões) Quantidade de Negócios Volum (US$ Billion) Number of trades Source: Veja and Advent International Notes: 2010: excluding investments out of Brazil (Burger King negotiation) 2007: excluding US$ 2,4 billions from investments on real estate sector and not private equity Negotiations without released value were not considered at volume, but were counted in the number of trades
But we still have a lot of things to be accomplished... Number of listed companies in Stock Markets – 2011 TMX Group 3 945 BME Spanish Exchanges 3 276 London SE Group 2 886 NASDAQ OMX 2 680 Tokyo SE Group 2 291 NYSE Euronext (US) 2 220 Australian SE 2 079 National SE India 1 640 Hong Kong Exchanges 1 496 Shenzhen SE 1 411 Osaka SE 1 229 1 112 NYSE Euronext (Europe) Bursa Malaysia 940 Ranking WFE Shanghai SE 931 Taiwan SE Corp. 824 23º Warsaw SE 777 NASDAQ OMX Nordic Ex 773 Singapore Exchange 773 Deutsche Börse 746 Tel Aviv SE 593 The SE of Thailand 545 Mexican Exchange 476 BM&FBOVESPA 466 Fonte: World Federation of Exchange (WFE). 0 1 000 2 000 3 000 4 000
Opportunities in the Brazilian Capital Market... BM&FBOVESPA initiatives with partners promoting lectures on IPOs Number of companies by size in those some Brazilians cities Segment have been developed with a EDUCATIONAL São Paulo – SP presence. More than 1,000 employees 3 Annual sales over BRL 400 thousand million 250 – 1,000 employees Curitiba – PR From 15 Annual sales between BRL 20m- thousand to 400m 20 thousand Up to 250 employees More than 3 Annual sales below BRL 20 million million Salvador – BA
BM&FBOVESPA works to provide access to SME Companies... = + Characteristics of companies seeking gradual access to the market Alternative for a great number of companies, for all sizes and with gradual strategy in regard to access to the capital markets
BM&FBOVESPA’s Strategy Reach out to companies in all maturity levels
BM&FBOVESPA’s Strategy – examples Highlight small and medium companies Ranking 2010 1.000 companies with annual revenue between R$ 62,3 million and R$ 230 million in 2009. Ranking 2011 2.000 companies with annual revenues between R$ 18 million and R$ 300 million in 2010
BM&FBOVESPA’s Strategy – examples Connecting Companies to Investors – Pre-IPO Stage FINEP* Agreement with BM&FBOVESPA Meetings among investors and companies that could possibly make an IPO or receive VC / PE investments Scope of the event: coaching of hired consultant in structuring the business plan of non listed companies. Executives from those companies will be trained to make presentation to institutional investors, banks, brokers and managers of venture capital Realized in November 8 th 2011 with participation of 4 companies Presence: 55 people – 18 representing investors – 29 representing banks and brokers – 7 others representing (non listed companies and audit firms) * Research and Project Financing, also known as the Brazilian Innovation Agency, is a publicly owned company subordinated to the Ministry of Science and Technology – MCT
The Brazilian Capital Market: recent developments and trends in Brazil Capital Market Cristiana Pereira Fev-9-12
Recommend
More recommend
