AJ Bell has identified six companies that may choose to float on the London Stock Exchange this year.
According to the platform, firms such as London Tunnels, Waterstones, and Boots could choose to launch an Initial Public Offering (IPO) in the near future.
Starling Bank, as well as Unilever’s ice cream arm and Froneri, have also been touted as potential candidates.
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Five companies have floated on the London stockmarket so far this year.
Those IPOs have significantly outperformed the wider FTSE All-Share index this year, while the outlook is improving for potential new listings, according to AJ Bell.
On average, the five stocks that have joined the UK stockmarket this year have enjoyed a 16.4% return versus a 2.5% year-to-date gain from the FTSE All-Share index.
Dan Coatsworth, investment analyst at AJ Bell, said: “This upbeat performance is seen against a backdrop where the FTSE 100 last week was on the verge of hitting a new all-time high. UK GDP data for February also showed 0.1% growth which means we only need March’s data to be in positive territory to deliver the full quarter of growth and no longer be qualified as in recession.
“These factors combined with the strong performance of new listings this year create a more positive backdrop for IPOs in the UK. The performance of the 2024 IPOs and the FTSE 100 also show the UK stockmarket is not stuck in the mud, despite opinions to the contrary.”
Of the five IPOs so far this year, MicroSalt is the best performer, up 62.8%.
Other IPOs include European Green Tansition, up 24.2% and Helix Exploration.
Meanwhile, airline Air Astana has fallen 14.7% since floating on the London Stock Exchange in February.
“The Bank of England starting the firing gun on interest rate cuts would add a further catalyst to drive more positive sentiment among businesses,” AJ Bell’s Coatsworth added.
“That could encourage more companies to list their shares on the London Stock Exchange and access capital markets to support their growth.
“The only problem is that it can take quite a long time between a company pressing the ‘go’ button on an IPO process and the shares to start trading.
“That suggests any big uptick in IPOs may not happen until the tail end of the year at the earliest. Companies may also want to wait for the general election to happen in case markets wobble in the interim period.”
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