Analysts have warned the City faces a ‘quiet’ outlook for IPO activity in the months ahead after just nine businesses listed on the London Stock Exchange in the first half of 2025.
Three of the listings in 2025 so far were on the main market, with the remaining six on the Alternative Investment Market.
The listings raised £182.8million in total, representing a 64 per cent drop from the same period a year ago, according to data from EY-Parthenon.
Momentum for initial public offerings on the LSE has been ‘slower to build, reflecting the broader macroeconomic and geopolitical headwinds facing businesses’, Scott McCubbin, EY-Parthenon UKI IPO Leader, said.
EY-Parthenon said the outlook for IPOs was ‘projected to remain quiet’ in the second half of the year, as many businesses grapple with higher costs and economic uncertainty.
The outlook for IPO activity is also being dampened by trade tensions between the US, according to the findings.
London listings: Only nine businesses listed on the London Stock Exchange in the first half of this year, data shows
In Europe, IPO activity faced declines as most major European markets paused amid market turmoil, EY-Parthenon said.
EY-Parthenon said a ‘more stable macroeconomic backdrop’ was needed before a rise in IPO activity could occur.
This week, the Confederation of British Industry warned that London’s stock market risked ‘drifting into irrelevance’.
In a report, the CBI called for bold reforms to revitalise the exchange.
The CBI wants stamp duty on share purchases to be scrapped and for pension funds to be encouraged to invest more in UK shares.
It also wants to see moves to reinvigorate public interest in shares, companies in Asia encouraged to have secondary listings in London, and the cost of IPOs to be made tax deductible.
The London market faces a worsening crisis with many of its most prominent companies being snapped up or switching their listings to New York.
The CBI’s report said British investors were ‘shifting away from UK equities’ while listings have slowed, private equity predators are acquiring many businesses and high-growth firms are often looking overseas to raise capital.
Fintech Wise is the latest to have confirmed such a move while recent reports suggested that even drugs giant AstraZeneca, which is Britain’s biggest listed business, may cross the pond.
McCubbin, of EY-Parthenon, said: ‘While there were expectations that 2025 would mark the rebound of the UK IPO market, momentum has been slower to build, reflecting the broader macroeconomic and geopolitical headwinds facing businesses.
‘Ongoing uncertainty around global trade and tariffs has fuelled market volatility, while escalating geopolitical tensions continue to influence energy prices and inflation expectations.’
He added: ‘Many of the challenges we’re seeing are not unique to London and are affecting exchanges around the world.
‘That said, London remains the fifth-largest exchange globally for equity capital raised, with over £7.5billion raised so far this year.
‘We anticipate renewed momentum in the M&A market in the second half of 2025, which could pave the way for a recovery in IPO activity. For companies considering going public, early preparation, a clear path to profitability, and operational resilience will be key.’
Grant Humphrey, a partner EY-Parthenon, said: ‘The global IPO market over the first six months of 2025 continues to reflect a cautious and risk-averse environment, shaped by persistent macroeconomic and geopolitical headwinds.
‘Investor caution, valuation pressures, supply chain disruptions and rising recession risks have further dampened listing activity with many PE-or VC-backed companies opting to put their IPO plans on hold. Looking ahead to the second half of 2025, without resolution on trade tensions or a more stable macroeconomic backdrop, the global IPO environment is projected to remain quiet.’
According to an analysis by AJ Bell, 88 companies left the London market or moved their primary listing elsewhere in 2024 and more than 70 have done the same so far in 2025.
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