IPO activity increased in the first quarter of 2024 with three listings raising £283.8 million

Listing activity on the London stock market saw an improvement in the first quarter of 2024 with three IPOs raising £283.8m.

The proceeds raised in Q1 2024 represent a 250% year-on-year (YOY) increase on the £81m raised from five listings in the same quarter in 2023 and a 100% increase on Q4 2023 when there were no listings on the main market or AIM.

Kazakhstani airline, Air Astana, was the largest listing on the main market, raising £277.5m, whilst Fuel Ventures VCT plc also listed on the main market, raising £3.2m. Low-sodium salt producer, MicroSalt plc raised £3.2m listing on AIM.

Scott McCubbin, EY UKI IPO Leader, said, “After a challenging 18 months for the equity markets it’s encouraging to see activity return to the London stock market, albeit at much lower levels than normal.

“Pent-up demand for IPOs means we are likely to see an upturn in the market in the second half of the year as macroeconomic challenges continue to ease. That said, the US and UK elections later this year will create an unprecedented level of regulatory and policy uncertainty which could influence industrial strategies, trade, climate/ESG and security policies, as well as impacting the economic and investment environment.

“Businesses looking to IPO will need to closely monitor election outcomes and how they affect stakeholder interests which may mean re-evaluating IPO timing to avoid facing further economic and geopolitical headwinds.”

Global IPO volumes fell 7% in the first quarter of 2024, but proceeds were up 7% YOY. In total, 287 IPOs raised US$23.7b in Q1 2024.

The Americas continued to exhibit strong performance in IPO activity compared with both the previous quarter and Q1 2023, with 52 deals and US$8.4b in proceeds, up 21% and 178%, respectively YOY.

The EMEIA IPO market also saw impressive growth at the start of the year, launching 116 IPOs totaling US$9.5b in the first quarter, up 40% and 58% YOY respectively. This surge was attributed to larger average deal sizes from IPOs in Europe and India.

Subdued IPO market sentiment across Asia-Pacific saw 119 deals recorded in Q1 and US$5.8b raised in proceeds, down 34% and 56% from the same period in 2023. This decline was particularly acute in Mainland China and Hong Kong, with both markets experiencing a consistent decline in IPO activity over the past few years.

Debbie O’Hanlon, EY UKI Private Leader, said, “The global IPO market has shown signs of a recovery with an uptick in enthusiasm from both IPO issuers and investors however, businesses looking to IPO will be in entering unchartered territory.

An evolving landscape influenced by changes in interest rates, intricate geopolitical dynamics, and a shift in investor focus towards profitability means companies eyeing IPOs must adjust to this new reality and reconsider their strategies and timing accordingly.”