Companies raised just £81million in flotations on the London stock market in a ‘very slow’ start to 2023.
The first quarter figures compiled by auditor EY were 80 per cent down on the same period last year and come amid a global slowdown for initial public offering (IPO) activity.
The figures will do nothing to ease gloom about the City’s status as a financial centre after a number of firms – such as Cambridge-based chip designer Arm and building materials giant CRH – listed their shares in New York.
Challenges: London’s main market saw only two IPOs in the first quarter of 2023, raising £63m. There were three flotations in the junior AIM market, raising £18m
Scott McCubbin, EY’s IPO leader for the UK and Ireland, said: ‘The London IPO market continues to experience the extremely challenging conditions witnessed in 2022.
‘There remain strong headwinds including the war in Ukraine, high energy and commodity prices, and wider inflationary pressures.’
London’s main market saw only two IPOs in the period, raising £63million. There were three flotations in the junior AIM market, raising £18million.
That was even worse than last year when a combined total of around £400million was raised. The 2023 figure is 99 per cent down from the record £5.7billion for the first quarter of 2021 and there are fears the threadbare period of activity will continue.
EY said that the London stock market witnessed ‘a very slow start to 2023’.
And McCubbin added: ‘We expect the market to remain challenging for the next few months, albeit with some green shoots in the form of an expected reduction to inflation by the year-end.
‘However, this remains at risk given the continued uncertain geopolitical landscape.’
Globally, there were 299 IPOs in the period, raising £17.3billion, down 61 per cent on last year and blamed on similar factors to those that have driven London’s decline in the same period.
The Government has been looking at ways to stem the exodus from London.
But figures yesterday suggested ordinary British retail investors were losing faith in the UK market too.
A survey by the UK arm of Charles Schwab – a brokerage helping investors access US stocks – found Britain now trailed behind America, Europe and emerging markets as the most attractive place to put their money.
