Markets at four-year peak set the stage for big tech deals in Asia-Pacific

Major technology deals across Asia Pacific are expected to jump significantly next year, with investment banking giant JPMorgan Chase & Co. forecasting the busiest period in years as the region builds on momentum that has already pushed activity to a four-year high.

Mark Fiteny, who leads JPMorgan’s technology, media and telecommunications investment banking operations across Asia Pacific, told Bloomberg Television on Monday that business activity has picked up dramatically.

He said his team is seeing deal pipelines larger than anything witnessed since 2021, describing the current outlook as stronger than it has been for an extended period.

Technology companies going public will drive much of this growth, particularly in major financial centers like Hong Kong, Japan and India. These initial public offerings are expected to generate the majority of investment banking fees in the region. Hong Kong alone has seen companies raise more than $32 billion through public offerings this year, according to data tracked by Bloomberg.

The technology sector has become increasingly important as traditional industries transform their operations. Healthcare, financial services, car manufacturing, and retail businesses are all undergoing major changes that rely heavily on new technology solutions, Fiteny explained.

Investment banks capitalize on growing Asian tech appetite

According to Fiteny, JPMorgan has been able to serve its clients effectively despite the political tensions between countries that result in complications and difficulty in dealmaking. 

JPMorgan’s push into Asian markets aligns with the surge in tech investment activity.

Artificial intelligence represents another significant growth area, with companies seeking money through various methods, including selling shares, taking on debt, and forming partnerships with other businesses. According to industry experts, AI-driven trends will accelerate significantly throughout 2025. This means that new and significant opportunities for investments and dealmaking may pop up.

Fiteny referred to strong tech activity in various Asian zones, particularly in India and Japan. However, he identified China as the primary growth driver for the entire Asian region.

Asian markets offer compelling valuations amid AI revolution

Beyond dealmaking, investment experts are pointing to Asia as an attractive destination for artificial intelligence-related investments. This idea came forward during JP Morgan Asset Management’s Asia Media Summit held in Seoul last week.

Paul Quinsee, JP Morgan’s global head of stock investments, maintained a positive outlook on artificial intelligence while urging realistic expectations. He noted that market excitement about artificial intelligence peaked at the end of April but has since cooled down, suggesting investors should take a contrarian approach.

Quinsee mentioned that US stocks have given 15% returns over the last 15 years, which is 2x of what investors earned elsewhere. However, the current year is different as a number of major developments have happened outside the US. International investors, who have approximately $17 trillion invested in American stocks, are now exploring other opportunities.

The pricing differences between Asian and American technology companies are particularly striking. Anuj Arora, who heads emerging markets and Asia Pacific stock investments, and Alexander Treves, head of investment specialists for the Asia Pacific region, presented data showing a nearly 50 percent valuation gap in technology hardware.

The top 10 Asia Pacific technology stocks trade at an average price-to-earnings ratio of 17 times as of August, compared to 32 times for the top 10 companies on the Nasdaq exchange.

Arora had earlier emphasized Asia’s crucial role in artificial intelligence development, noting that 65 percent of all semiconductors are produced in the region. He stressed that the artificial intelligence revolution cannot succeed without Korean, Japanese and Chinese companies.

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