A couple of weeks later, GemLife, priced at $4.16 per stapled security to raise $750 million, closed its first day about 4 per cent up. It was the largest domestic IPO of the year. Not fireworks mind you, but not a faceplant either. It looked like properly priced paper that traded as if it belonged.<\/p>\n
If floats were the headline, follow-ons were the body text. The early cycle choreography is textbook: placements, rights issues and SPPs do the heavy lifting while the IPO window tests its hinges.<\/p>\n
Through July\u2013August you could point to oversubscribed raises across the small-cap patch with pretty much every raise oversubscribed. As a few examples, Locksley Resources put its hand up for about $3 million but ended up taking more than $5 million, with applications topping $11 million. Astute Metals dragged in about $5.5 million, including some significant scale-backs. Marquee Resources easily met its target and then some, dragging in roughly $2.5 million. Then there was a standout retail datapoint with Australian Strategic Materials pulling in around $12 million via an SPP, which had set out to raise just $3 million. The company also banked a further $13 million via a cap raise \u2013 also oversubscribed \u2013 just for good measure.<\/p>\n
These numbers are not living in isolation. As Dollar Bill recently pointed out, small caps on the ASX outperformed every other sector over the past 12 months by more than 8 per cent \u2013 the first sector outperformance in nearly five years. I said it a year ago and I\u2019ll say it again – small caps are back baby!<\/p>\n
Supporting this, the latest ASX advisor survey, which collects the opinions of more than 100 industry professionals, has more than 50 per cent backing small caps over everything else. Importantly, price-to-earnings ratios of small caps remain significantly beneath their larger counterparts \u2013 some of which are trading at crazy multiples.<\/p>\n
That mix tells you that while risk appetite may not yet be sprinting for small caps, value suggests it is seeping back with evidence in support.<\/p>\n
Market tone also matters. August\u2019s cash market ran on-market average daily value in the $7.1\u20137.2 billion post code, and the S&P\/ASX 200 VIX hung around the low-teens.<\/p>\n
For those of you who don\u2019t live and breathe markets like Dollar Bill, let me explain. Talk about the \u201ccash market\u201d and the ASX refers to the average dollar value of shares traded per day on the ASX\u2019s order book, or total turnover divided by the number of trading days. And the VIX, commonly referred to as the \u201cvolatility indicator\u201d, is something Dollar Bill watches religiously on the telly at the club through his cognac glass because of its unerring accuracy to predict turning points. A relatively low VIX, as we have now, suggests it\u2019s steady as she goes, while the average daily values traded in August were up 20 per cent on the average for the previous months and about 25 per cent on this time last year.<\/p>\n
The past few months, kicking off in June, have clearly put a little froth back into the taps, with July keeping the glasses topped up nicely. August reminded us that the keg still has a slow leak – but it\u2019s definitely not empty.<\/p>\n
The global backdrop isn\u2019t hurting either. EY tallied 539 IPOs in the first half of 2025 globally, which raised a lazy US$61 billion. This was up on the prior year, with a record cross-border mix and about 62 per cent of US listings coming from foreign issuers. That\u2019s the sort of wind you want at your back if you\u2019re an Australian sponsor arguing for global money to follow you home.<\/p>\n
As EY\u2019s global leader on IPOs George Chan put it: \u201cThe realignment of the IPO market across regions and sectors reflects a deeper shift in global capital flows and investor sentiment.\u201d<\/p>\n
Closer to home, the pipeline page that looked like a ghost town six months ago is finally getting a few lights on. The ASX\u2019s \u201cupcoming floats and listings\u201d now show a live queue into late September and October. In fact, there\u2019s about a dozen queued up now when there was literally three on the page only a few months back. The current names include DPM Metals, Golden Dragon, Golden Globe, Green & Gold Mining and PC Gold \u2013 a veritable sea of gold.<\/p>\n
There\u2019s also Temas Resources, Revolution Private Credit Income Trust, Ryman Healthcare and a handful of others lining up with indicative tickets in the single-digit millions to a few hundred million.<\/p>\n
Of course, none of it is guaranteed. The ASX reminds you that only formal applications make the list, typically four to six weeks out and dates\/amounts are subject to change. But the point is simple: there\u2019s inventory again. Sponsors have stopped asking whether the window exists and have started asking whether their story belongs in it.<\/p>\n
Now, Dollar Bill isn\u2019t suggesting we\u2019re back in 2021-land \u2013 at least not yet – but the old left leg is starting to twitch a little.<\/p>\n
And if 2024 taught humility, 2025 is teaching muscle memory. The ASX has rediscovered the quiet arts of setting a range, running a book and, most importantly, closing one. Virgin and GemLife weren\u2019t miracles – they were signals that investors will fund a credible equity story at a fair price.<\/p>\n
There\u2019s also a subtle but important shift in who\u2019s doing the buying. The institutional tilt on larger raises has helped registers look sturdier and, as a result, the first day\u2019s post listing looks less like a street fight. Retail is peeking back in where the story makes sense, SPPs that meet or beat targets and early closes that don\u2019t feel like stunts, which is the right order of operations.<\/p>\n
And the months ahead? Dollar Bill suggests watching the order books and the early day volumes for new listings. If allocations continue to tighten and stag profit-takers don\u2019t tear it up by lunchtime, the window for small caps and new listings is more than just ajar. As the legendary former Australian rugby union coach Dave Brockhoff once said, when the opportunity presents, it\u2019s the time for crowbars through the Opera House windows \u2013 get in, loot the joint and get out.<\/p>\n