The decision by Marex Spectron, Tungsten West and Elcogen to postpone their proposed stock market listings may be seen by some as a further sign that London is losing its lustre as a venue for up-and-coming firms, especially after the cool reception received by Deliveroo and Alphawave IP, but the picture may not be as black as it seems, says AJ Bell Investment Director Russ Mould.
“The average share price gain across the 40 or so firms that have made it to market this year is 23%, compared to the initial offering price. It can therefore be argued that investors are sifting through market newcomers in a very methodical manner, buying those that meet their governance, business model, financial performance and valuation criteria and spurning those that do not.
“And since – according to Warren Buffett – the first rule of investment is ‘Never lose money,’ with the second rule being ‘Never forget rule number one,’ that seems like a sensible policy. Avoiding losers is every bit as important as picking winners.
“Granted, it is still frustratingly difficult for private investors to get access to IPOs at the actual offer price and they are left scrambling to buy stock in good deals in the open market. As such, they will have not had a chance to accrue that average 24% capital gain. But at least professional money managers have been doing their job by protecting client funds and not piling into any old deal at any old price.
London IPOs in 2021 ranked by performance since listing
|Company||Date||Market||Money raised (£m)||Gain/loss now vs IPO price|
|Caerus Mineral Resources||19-Mar-21||UK Main Market||2.3||172.0%|
|Auction Technology||23-Feb-21||UK Main Market||247.4||94.7%|
|MGC Pharmaceuticals||09-Feb-21||International Main Market||6.5||69.3%|
|Roquefort Investments||22-Mar-21||UK Main Market||1.0||45.0%|
|Darktrace||30-Apr-21||UK Main Market||143.4||41.8%|
|Cellular Goods||26-Feb-21||UK Main Market||13.0||38.6%|
|Dr Martens||29-Jan-21||Main Market||0.0||35.8%|
|Trustpilot||23-Mar-21||UK Main Market||46.7||22.5%|
|In The Style Group||15-Mar-21||AIM||11.0||18.0%|
|Digital 9 Infrastructure||31-Mar-21||UK Main Market||267.0||9.1%|
|Taylor Maritime Investments||27-May-21||UK Main Market||112.7||5.0%|
|Cordiant Digital Infrastructure||16-Feb-21||UK Main Market||370.0||4.0%|
|Foresight Group||04-Feb-21||Main Market||35.0||1.2%|
|VH Global Sustainable Energy Opportunities||02-Feb-21||Main Market||242.6||0.7%|
|Mast Energy Developments||07-Apr-21||UK Main Market||5.5||(1.0%)|
|Pensionbee||21-Apr-21||UK Main Market||55.0||(3.6%)|
|East Star Resources||04-May-21||UK Main Market||2.0||(13.0%)|
|Oxford Cannabinoid Tech Holdings||21-May-21||UK Main Market||16.5||(13.6%)|
|Alphawave||13-May-21||UK Main Market||360.1||(22.6%)|
|Cizzle Biotechnology||14-May-21||UK Main Market||2.2||(33.0%)|
|Deliveroo||31-Mar-21||UK Main Market||1000.0||(35.4%)|
|TOTAL CAPITAL RAISED||3,232|
Source: London Stock Exchange, Refinitiv data