Market Overview

Total Depositary Receipt Capital Raised in the First Half of 2018 Reaches $8.4 Billion


Asia-Pacific Generates 77% of Total

Demand for non-U.S. equities continued on a strong trajectory as global
issuers raised $8.4 billion in depositary receipts (DR) during the first
half of 2018, an increase of 104% from the first half of 2017, according
to an industry report from Citi.

The rise in DR capital raisings was driven primarily by increased
activity in the Asia-Pacific region, with total capital raisings of $6.5
billion – more than 77% of the total pool – compared to just $1.4
billion in the first half of 2017. China-based issuers raised a combined
$5.2 billion, accounting for 62% of the total DR capital raised in 2018.
Among these issuers, iQIYI, a Beijing-based software & services company,
raised $2.3 billion in its March IPO – the largest DR IPO capital
raising. In addition, BeiGene Ltd., a biotechnology company, conducted
an $800 million follow-on offering – the largest DR secondary offering
in the first half of 2018.

The trend of Emerging Growth Companies (EGCs) raising capital continued
in the first half of 2018, with eight of nine China-based issuers
choosing to come to market via the JOBS Act. Enacted in 2012 to help
small emerging companies access capital in the U.S., the JOBS Act
modified capital raising regulatory requirements for a new category of
issuer known as an EGC (defined as an issuer generating less than $1.07
billion in gross annual revenue). Of the JOBS Act IPO DR deals in the
first half of 2018, China-based issuers accounted for more than half by
number of deals and 68% by total capital raised.

Citi Depositary Receipt Services remains committed to supporting global
issuers seeking to raise capital in DR form.

"Citi was the depositary bank in over a third of the DR capital raising
deals in the first half of 2018, continuing our leading position in the
industry," said Nancy Lissemore, Global Head of Depositary Receipt
Services at Citi. "The rebound in DR capital raising activity
demonstrates that the DR structure remains an attractive vehicle of
choice for issuers to raise capital."

Other Notable DR Market Highlights in the first half of 2018 include:

  • The Internet and Oil & Gas sectors accounted for 48% of the total DR
    trading value.
  • 13 issuers completed IPOs by way of the JOBS Act versus 6 in the first
    half of 2017.
  • Trading volume of unsponsored ADR programs increased 60% from the
    first half of 2017 to 2.2 billion, primarily due to increases in
    trading volume from Chinese issuers.
  • Unsponsored ADR programs from China and Japan accounted for 48% of the
    total unsponsored trading volume.

Citi is a leading provider of depositary receipt services. With
depositary receipt programs in 64 markets, spanning equity and
fixed-income products, Citi leverages its global network to provide
cross-border capital market access to issuers, intermediaries and

For more details on 2018 DR highlights, please refer to the Citi DR

About Citi

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