Larger IPOs Are Back…But From a New Place

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Large-scale IPOs (initial public offerings) have hit record levels year-to-date, as new emerging countries enter the market and investors hunt for higher returns.

(Read More: Big Week for IPOs, More Coming)

Ten IPOs of $1 billion or more have launched in 2013 so far, compared with only two deals in the same period last year. This the highest level of activity since 2010, when there were 14 deals of the size during that time span.

Meanwhile, volumes of $1 billion-plus IPOs have reached $18.2 billion this year, over six times higher than in the same period in 2012.

"It certainly feels like we are on much more solid ground than last year… last year, only deals with the very best assets, or with companies that were willing to accept low valuations got done," said Edward Bibko, the London head of capital markets at Baker & McKenzie.

"The fundamentals are starting to fall into place. We certainly hope the rest of this year and next year will continue to improve."

Analysts and lawyers such as Bibko note an uptick in deals from less developed countries, which are attracting interest from fund managers as they hunt for returns in a low yield environment.

Notably, this year's largest IPO so far has come from Brazil, with insurance group Banco do Brasil Seguridade raising $5.1 billion on Sao Paulo's Bovespa. Earlier this year, Iraqi mobile operator Asiacell launched the Middle East's biggest IPO since 2008, and became the first telecommunications firm listed on the Baghdad bourse.

"It is a very geographically diverse mix of companies, so it does show some of the globalization of the IPO markets we have seen over the last several years," said Nick Einhorn, an analyst with IPO advisory firm Renaissance Capital.

"Certainly we are seeing IPOs from jurisdictions we have not seen for a while, the Middle East particularly. We thought they would be closed for a while, after the Arab Spring," said Bibko.

"There is a bit of a decoupling; investors are looking to jurisdictions with greater country risk, but that are not saddled with great economic difficulties. ... I think investors have taken a look at the world, have thought it looks a bit risky, and decided emerging markets do not look so risky in comparison."

In Mexico, another previously inactive market, four companies went public during the first quarter of 2013. Total deal volumes for Mexico during the period stood at $2.3 billion, equalling those on the London Stock Exchange. In comparison, there were no IPOs greater than $100 million in Mexico in first quarter 2012.

"In the case of BB Seguridade, we are seeing the re-opening of the Brazilian IPO market, which has been very slow over the last couple of years; in the case of Asiacell, we are seeing the emergence of a new country on the IPO scene," said Einhorn.

"Then you have Hong Kong, which typically vacillates very quickly between being a busy IPO market and a slow IPO markets, but it look like it is picking up again with two big deals on the horizon—Galaxy and Sinopec Engineering."

(Read More: Hong Kong's IPO Market Is Heating Up)

In a report on first quarter IPO activity, Renaissance Capital noted that recovering real estate markets and interest in yield-orientated real estate investment trusts (REITs) were also boosting overall volumes. This trend is particularly notable in Japan, where volumes reached an all-time high in the first four months of the year, helped by a $1.1 billion IPO from Nippon Prologis REIT.

(View More: Map Tracking the US Real Estate Recovery)

Baker & McKenzie's Bibko said he is eyeing frontier markets in central Asia and Africa, as well as Iraq and Turkey, for IPO potential.

"We currently have a great focus on Africa. … You see interest typically in things like natural resources, and also regulated industries like telecommunications, because they have a predictable cash flow," he said.

—By CNBC's Katy Barnato