BC investment markets prove resilient with record capital raising

The provincial securities regulator says market capitalization also hit a new high during 2020

BC investment markets prove resilient with record capital raising
Steve Randall

Despite initial disruption, investment markets in British Columbia proved resilient and strong in 2020 according to new stats.

The total market value of the province’s public companies grew almost 50% in 2020 to a record high of $286 billion. In the previous year growth was just 2%.

The new report from the British Columbia Securities Commission (BCSC) also reveals that capital raising by BC companies grew 38% to $23.6 billion in 2020.

This was driven by mining and other natural resource companies followed by the real estate and technology sectors.

BC is home to 45% of Canada’s listed companies and including more than half of Canadian-listed venture companies. The province’s companies tend to be smaller than those in Ontario, Alberta, and Quebec, with more than one third having a market value below $5 million.

"COVID-19 rattled B.C. investment markets in the first quarter of 2020, but they rebounded quickly, demonstrating their resilience and strength even during a global pandemic," said John Hinze, the BCSC's Director of Corporate Finance. "Not only did B.C. public companies finish the year with a record market capitalization, they also reported record capital-raising, including filing a record number of prospectuses with the BCSC."

Overall in 2020, the BC capital market – which includes capital-raising by B.C. companies and investment funds, as well as capital raised from BC investors – grew 29% to $135.5 billion, delivering a fourth consecutive year of growth.

BC capital raising by industry

  • Mining: Capital-raising increased 125% in 2020. In total, 781 mining companies raised $8.1 billion in capital, accounting for 34% of the capital raised by BC companies.
  • Technology, communication and entertainment: Capital-raising increased in 2020, as it did in 2019, primarily due to Telus Corporation completing significant financings in both years.
  • Biotechnology: This sector raised $2.3 billion in 2020, a 123% increase, with the majority raised by four B.C. companies, AbCellera Biologics Inc., Zymeworks Inc., Aurinia Pharmaceuticals Inc., and Xenon Pharmaceuticals Inc.
  • Real estate: Capital-raising stayed steady, attracting $2.8 billion in investment, a 1% decrease from the previous year.
  • Cannabis: Capital-raising in this sector dropped 67% to $0.67 billion in 2020, continuing to cool down from the frenetic pace after cannabis legalization in 2018.