In this report Asia, as a region, includes the following 18 jurisdictions: Bangladesh, Cambodia, People’s Republic of China, Hong Kong (China), India, Indonesia, Japan, Korea, Lao PDR, Malaysia, Mongolia, Pakistan, Philippines, Singapore, Sri Lanka, Chinese Taipei, Thailand and Viet Nam. The report follows the IMF country classification to identify advanced economies, and emerging and developing economies. In this respect, advanced Asian economies include Hong Kong (China), Japan, Korea, Singapore and Chinese Taipei, while emerging and developing Asian economies include Bangladesh, Cambodia, People’s Republic of China, India, Indonesia, Lao PDR, Malaysia, Mongolia, Pakistan, Philippines, Sri Lanka, Thailand and Viet Nam.
Corporate Finance in Asia and the COVID-19 Crisis
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Annex A. Methodology for data collection and classification
A. Balance sheet information for non-financial listed firms
The information presented in Section 1.1 is based on the Thomson Reuters Datastream. The unbalanced panel dataset contains financial statement information for non‑financial listed companies between 2005 and 2020. The universe covers 50 376 companies registered in 133 countries.
Financial information cleaning
The raw financial dataset contains several firm‑year observations when a company reports for different purposes. To construct a panel with a unique firm‑year observation, the following steps are applied:
Financial companies are excluded
Firms listed on an over‑the‑counter (OTC) market are excluded
Security types classified as “units” and “trust” are excluded
Firms identified as delisted are excluded
For firms with multiple observations but different countries of domicile, their true country of domicile is manually checked to remove the duplicates
Financial statements covering a 12‑month period are used
Companies with at least one observation showing negative assets or negative fixed assets are excluded
Financial information is adjusted by annual US Consumer Price Index changes and information is reported in 2020 USD
The information presented in Section 2.2 is also based on the Thomson Reuters Datastream. The information on reported sales is collected for a representative regional sample of listed companies. Sales data reported in interim quarterly financial statements are collected for all quarters in 2019 and the ones available in 2020. Financial companies are excluded from the sample.
Industry classification
The Thomson Reuters Datastream uses Thomson Reuters Business Classification (TRBC). The economic sectors used in the analysis are listed in Table A A.1.
Table A A.1. Economic sectors based on the Thomson Reuters Business Classification
Thomson Reuters Economic Sector |
|
---|---|
Basic Materials |
Industrials |
Cyclical Consumer Goods / Services |
Non-Cyclical Consumer Goods / Services |
Energy |
Technology |
Financials |
Telecommunications Services |
Healthcare |
Utilities |
B. Listing information
The information presented in Figure 1.23 is based on the OECD-ORBIS Corporate Finance database. The listing status is collected from the ORBIS Legal Information tables between 2008 and 2019, and is further complemented with information retrieved from Worldscope.
C. Public equity data
The information on initial public offerings (IPOs) and secondary public offerings (SPOs or follow-on offerings) presented is based on transaction and/or firm‑level data gathered from several financial databases, such as Thomson Reuters Eikon, Thomson Reuters Datastream, FactSet and Bloomberg. Considerable resources have been committed to ensuring the consistency and quality of the dataset. Different data sources are checked against each other and, whenever necessary, the information is also controlled against original sources, including regulators, stock exchanges and company websites and financial statements.
Data used in Figure 1.25 classifies companies as listed on a foreign jurisdiction whenever the jurisdiction of the company’s headquarter is different from the stock exchange jurisdiction where the company’s shares are listed. Additionally, China in this exercise refers to mainland China and Hong Kong (China) together.
Country coverage and classification
The dataset includes information about all initial public offerings (IPOs) and secondary public offerings (SPOs or follow‑on offerings) by financial and non‑financial companies. All public equity listings following an IPO, including the first time listings on an exchange other than the primary exchange, are classified as a SPO. If a company is listed on more than one exchange within 180 days, those transactions are consolidated under one IPO. The country breakdown is based on the issuer’s country of domicile. In the dataset, the country of issue classification is also made based on the stock exchange location of the issuer.
It is possible that a company becomes listed in more than one country when going public. The financial databases record a dual listing as multiple transactions for each country where the company is listed. However, there is also a significant number of cases where dual listings are reported as one transaction only based on the primary market of the listing. For this reason, the country breakdown based on the stock exchange is based on the primary market of the issuer.
Currency conversion, inflation adjustment and growth company threshold
The IPO and SPO data are collected on a deal basis via commercial databases in current USD values. The information presented is aggregated at the annual frequency and in some tables, presented at the year‑industry level. Issuance amounts initially collected in USD were adjusted by 2021 US Consumer Price Index (CPI).
In Section 1.2, the threshold for identifying growth company IPOs – USD 100 million – is fixed in 2010 USD adjusted by US CPI. Information provided in Chapter 2 is collected and presented in current USD.
Industry classification
Initial public offering and secondary offering statistics are presented in this report using the Thomson Reuters Business Classification (TRBC). The economic sectors used in this analysis are listed in Table A A.1.
Exclusion criteria
With the aim of excluding IPOs and SPOs by trusts, funds and special purpose acquisition companies the following industry categories are excluded:
Financial companies that conduct trust, fiduciary and custody activities
Asset management companies such as health and welfare funds, pension funds and their third‑party administration, as well as other financial vehicles
Open-end investment funds
Other financial vehicles
Grant-making foundations
Asset management companies that deal with trusts, estates and agency accounts
Special Purpose Acquisition Companies (SPACs)
Closed-end investment funds
Listings on an over‑the‑counter (OTC) market
Security types classified as “units” and “trust”
Real Estate Investment Trusts (REITs)
Transactions with missing or zero proceeds
D. Ownership data
The main source of information is the FactSet Ownership database. This dataset covers companies with a market capitalisation of more than USD 50 million and accounts for all positions equal to or larger than 0.1% of the issued shares. Data are collected as of end of 2020 in current USD, thus no currency nor inflation adjustment is needed. The data are complemented and verified using Thomson Reuters Eikon and Bloomberg. Market information for each company is collected from Thomson Reuters Eikon. The dataset includes the records of owners for 25 766 companies listed on 92 markets covering 98% of the world market capitalisation. For each of the economies/regions presented, the information corresponds to all listed companies in those economies/regions with available information.
The information for all the owners reported as of the end of 2020 is collected for each company. Some companies have up to 5 000 records in their list of owners. Each record contains the name of the institution, the percentage of outstanding shares owned, the investor type classification, the origin country of the investor, the ultimate parent name, among other things.
The table presents the five categories of owners defined and used in this report. Different types of investors are grouped into these five categories of owners. In many cases, when the ultimate owner is identified as a Government, a Province or a City and the direct owner was not identified as such, ownership records are reclassified as public sector. For example, public pension funds that are regulated under public sector law are classified as government, and sovereign wealth funds (SWFs) are also included in that same category.
Table A A.2. Categories of owners
Investor category |
Investor type |
|
---|---|---|
Private corporations and holding companies |
Business Association |
Operating Division |
Employee Stock Ownership Plan |
Private Company |
|
Holding Company |
Public Company |
|
Joint Venture |
Subsidiary |
|
Non-profit organisation |
||
Public sector |
Government |
Regional Governments |
Sovereign Wealth Manager |
Public Pension Funds |
|
Strategic individuals and family members |
Individual (Strategic Owners) |
Family Office |
Institutional investors |
Bank Investment Division |
Mutual Fund Manager |
Broker |
Other |
|
College/University |
Pension Fund |
|
Foundation/Endowment Manager |
Pension Fund Manager |
|
Fund of Funds Manager |
Private Banking/Wealth Management |
|
Fund of Hedge Funds Manager |
Private Equity Fund/Alternative Inv. |
|
Hedge Fund |
Real Estate Manager |
|
Hedge Fund Manager |
Research Firm |
|
Insurance Company |
Stock Borrowing/Lending |
|
Investment Adviser |
Trust/Trustee |
|
Market Maker |
Umbrella Fund |
|
Mutual Fund-Closed End |
Venture Capital/Private Equity |
|
Other free‑float including retail investors |
Shares in the hands of investors that are not required to disclose their holdings. It includes the direct holdings of retail investors who are not required to disclose their ownership and institutional investors that did not exceed the required thresholds for public disclosure of their holdings. |
E. Corporate bond data
Data presented on corporate bond issuances are based on OECD calculations using data obtained from Thomson Reuters Eikon that provides international deal‑level data on new issues of corporate bonds that are underwritten by an investment bank. The database provides a detailed set of information for each corporate bond issue, including the identity, nationality and sector of the issuer; the type, interest rate structure, maturity date and rating category of the bond, the amount of and use of proceeds obtained from the issue.
Convertible bonds, deals that were registered but not consummated, preferred shares, sukuk bonds, bonds with an original maturity less than or equal to one year or an issue size less than USD 1 million are excluded from the dataset. The analyses in the report are limited to bond issues by non‑financial companies. The industry classification is carried out based on Thomson Reuters Business Classification (TRBC). The country breakdown is carried out based on the issuer’s country of domicile. Yearly issuance amounts initially collected in USD were adjusted by 2021 US Consumer Price Index (CPI). Information provided in Chapter 2 is collected and presented in current USD.
Given that a significant portion of bonds are issued internationally, it is not possible to assign such issues to a certain country of issue. For this reason, the country breakdown is carried out based on the country of domicile of the issuer. The advanced/emerging market classification is based on IMF country classification.
Rating data
Thomson Reuters Eikon provides rating information from three leading rating agencies: S&P, Fitch and Moody’s. For each bond that has rating information in the dataset, a value of 1 to the lowest credit quality rating (C) and 21 to the highest credit quality rating (AAA for S&P and Fitch and Aaa for Moody’s) is assigned. There are 11 non-investment grade categories: five from C (C to CCC+); and six from B (B- to BB+). There are ten investment grade categories: three from B (BBB- to BBB+); and seven from A (A- to AAA).
If ratings from multiple rating agencies are available for a given issue, their average is used. Some issues in the dataset, on the other hand, do not have rating information available. For such issues, the average rating of all bonds issued by the same issuer in the same year (t) is assigned. If the issuer has no rated bonds in year t, year t‑1 and year t‑2 are also considered, respectively. This procedure increases the number of rated bonds in the dataset and hence improves the representativeness of rating‑based analyses. When differentiating between investment and non‑investment grade bonds, the final rating is rounded to the closest integer and issues with a rounded rating less than or equal to 11 are classified as non‑investment grade.
Early redemption data
When calculating the outstanding amount of corporate bonds in a given year, issues that are no longer outstanding due to being redeemed earlier than their maturity should also be deducted. The early redemption data are obtained from Thomson Reuters Eikon and cover bonds that have been redeemed early due to being repaid via final default distribution, called, liquidated, put or repurchased. The early redemption data are merged with the primary corporate bond market data via international securities identification numbers (i.e. ISINs).