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Taiwan’s capital markets experienced a challenging start in 2025, heavily impacted by the tariff measures imposed by the US and the significantly heightened market volatility and trade uncertainty. Investor sentiment remained cautious, and most capital market activity slowed markedly during the first half of the year. Market confidence began to recover only around September, driven primarily by renewed IPO activity among startups and the foreign currency funding needs of companies engaged in AI-related supply chains.

Taiwan IPO activity in 2024 to 2025

Taiwan’s capital market demonstrated strong performance in 2024. The total number of newly listed companies, including those on the Taiwan Innovation Board (TIB), transfers from over-the-counter to the main board, and holding company conversions, reached 67 – up from 45 in 2023 – while total funds raised amounted to NTD57.6 billion (USD1.83 billion), surpassing the previous year’s NTD37.9 billion.

From an industry perspective, the biotech and medical sector remained dominant, expanding from seven listings in 2023 to 15 in 2024, followed by nine semiconductor listings. The Taiwan Innovation Board continued to focus on supporting companies with high innovation potential and growth prospects, particularly in light-asset sectors, digital and cloud services, smart healthcare and green technology.

Taiwan reforms boosting local and overseas listings

In an effort to strengthen the local stock market, the Taiwan Stock Exchange (TWSE) announced a series of four major regulatory reforms in 2025. These initiatives are designed to streamline procedures for both domestic and foreign companies seeking to list in Taiwan.

The reforms primarily shorten custody periods, reduce underwriter sponsorship obligations and simplify internal control reporting requirements. Collectively, these measures lower the listing barriers, accelerate listing timelines and attract innovative companies to Taiwan’s capital market.

Expanding trading liquidity on the TIB. On 6 January 2025, the TWSE fully eliminated the qualified investor restrictions for TIB-listed stocks, significantly broadening the pool of potential market participants. Additional measures to enhance liquidity include the introduction of day trading for TIB stocks, the relaxation of mutual fund investment limits and the explicit allowance for TIB stocks to be included as underlying assets in exchange-traded funds.

Accelerating listing procedures for domestic companies. To encourage faster market entry by domestic companies with proven profitability, the TWSE streamlined compliance and reporting obligations under the TIB framework. Key adjustments include:

(1) Shortening the custody period from two years to one year;

(2) Shortening the underwriter sponsorship periods; and

(3) Shortening internal control reporting requirements from three fiscal years to one.

These measures collectively aim to reduce legal and procedural obstacles, encouraging high-growth domestic enterprises to list and actively participate in Taiwan’s capital market.

Optimising listing rules for foreign companies (KY shares). To attract internationally competitive foreign enterprises, the TWSE introduced flexible adjustments targeting companies with operations and ownership structures outside Taiwan and the Chinese mainland. Among others, the rules introduce flexible independent director requirements, mandating only two Taiwan-based independent directors and reducing underwriter sponsorship and internal control reporting periods. These reforms are intended to enhance Taiwan’s attractiveness as a listing venue for innovative foreign companies.

Enhancing board transfer mechanisms. The final set of reforms introduces greater flexibility in board transfers, allowing companies to move between the TIB, the main board or the over-the-counter market in accordance with their strategic needs. Eligible companies may request a transfer after one year of listing, provided they meet the criteria of the target board. This approach empowers companies to select the most suitable platform for market visibility, capital-raising and long-term growth, creating a more dynamic and responsive capital market ecosystem.

Taiwan cross-border capital raising amid AI supply chain growth

The rapid expansion of AI-related supply chains in Taiwan has created substantial foreign currency funding requirements for publicly listed companies, prompting a series of cross-border capital market transactions by way of global depositary receipts (GDRs) and external commercial borrowings, or offshore convertible bond (ECB) offerings in 2025.

(1) WT Microelectronics completed a dual-track offering in late 2025, consisting of a GDR issuance of about USD388.8 million and ECBs totalling USD350 million, raising a combined USD738.8 million. This transaction represents the largest capital fundraise in the company’s history. The proceeds were directed towards overseas procurement of AI-related components and the scaling of international supply chain operations in the US and European industrial and automotive markets. The transaction also shows the market’s high-level confidence in the company’s strategic vision and future growth potential.

(2) BizLink completed its USD300 million (equivalent to about NTD9 billion) sixth ECB issuance in September 2025, with a 30% premium on the conversion price. The offering marked the largest single capital fundraise in the connector industry to date. BizLink partnered with SENKO Advanced Components and ficonTEC Service to co-develop an integrated optical interconnect solution, targeting advanced optical communications infrastructure and supporting high-performance requirements of AI data centres.

(3) Wistron Corporation completed a USD1.2 billion ECB offering in October 2025 to address foreign currency funding needs for component procurement. In parallel, to support next-generation AI product research, development and manufacturing capacity, Wistron increased capital expenditures for its Fremont, California, subsidiary from USD71 million to USD143 million. The company also accelerated construction at its Dallas facilities, allocating USD62.5 million for building improvements, while its Dallas after-sales service facility received an additional investment of up to USD12.9 million to meet customer requirements for advanced AI platform products. These initiatives reflect Wistron’s proactive approach to securing foreign currency financing, expanding R&D and manufacturing capabilities, and reinforcing its strategic position within the global AI supply chain.

(4) Quanta Computer completed a USD1 billion ECB issuance in 2025, with a 40% premium on the conversion price. The proceeds were targeted to address foreign currency funding needs for component procurement. Quanta explained that its 2025 fundraising activities are driven by three key factors – supporting AI server shipments, expanding overseas manufacturing capacity and distributing production across multiple jurisdictions. These strategic initiatives have led to a substantial increase in foreign currency funding requirements.

Taiwan capital markets amid AI realignment

In summary, Taiwan’s regulatory framework is gradually becoming more accessible to both domestic and foreign companies, lowering entry barriers and facilitating capital raising through the Taiwanese stock market. This evolving regulatory environment fosters a mutually beneficial outcome, enabling local and international companies to secure the funding necessary for growth while enhancing the overall competitiveness of Taiwan’s capital market.

The expansion of AI-related supply chains has generated substantial foreign currency funding requirements for listed companies in 2025. Looking ahead, continued demand for AI hardware and related components is expected to sustain cross-border capital market transactions and financing activities into early 2026.

Additionally, market trends indicate that Taiwanese companies are accelerating the supply chain shift from the Greater China region towards the US and Mexico, driven by US manufacturing localisation policies. This relocation affects industry positioning, requiring Taiwanese firms to establish North American production facilities and expand advanced manufacturing, packaging and R&D capabilities. These trends are likely to further increase capital expenditures and foreign currency funding needs, supporting both domestic and cross-border capital market activity.