The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.

All material subject to strictly enforced copyright laws. © 2022 Euromoney, a part of the Euromoney Institutional Investor PLC.

Telstra fuels an equity boom

Australians, big exporters to Asia, are bracing themselves for economic trouble. But, as Ian Rogers reports, stock prices are still rising. Investors can't get enough of big new issues such as telecoms company Telstra.

Can the banks survive alone?

In mid-March the Australian government decided to follow up on the success of its initial privatization of Telstra by selling off the whole of the Australian telecoms company. The sale will be the most significant event in the country's capital markets in the decade-and-a-half since financial deregulation was introduced.

The sale in November 1997 of a 35% tranche of Telstra established the mood, and the demand, for shares in the country's dominant telecoms company. Partly-paid shares in Telstra (dubbed instalment receipts) sold for A$1.95 ($1.32) and rallied steadily to A$3.80 by mid-March.

Last year's IPO attracted 1.8 million people to the telecom's share register. Half of these shareholders made their debut as individual share investors, a choice the financial services industry hopes these novices will soon repeat. The government also wants to use privatization as a means to develop a share-owning culture among Australian householders.

One long-term bonus of Telstra's privatization is that it will swell the market capitalization of Australian equities, attracting more international capital to the stock market and increasing its liquidity. "It's important in terms of spreading ownership and lifting the free float of the market," says Trevor Rowe, the Sydney-based chairman of Salomon Smith Barney's Asia-Pacific operations.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.


Unlimited access to and

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually


Unlimited access to and, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors


Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree