Confirmation from Raspberry Pi that it is planning to list its shares in London sent a fresh pulse of positivity through the City, analysts said.
Last year saw the second-lowest inflow of initial public offers (IPOs) on the LSE in almost three decades, with just 23 companies arriving on the market.
There were three new listings in the first quarter of 2024, though reports continued to emerge of apparent pent-up demand.
Sentiment was said to have been improving lately, but ultimately companies and advisors are waiting for the right market mood and conditions to become more amenable, with interest rate cuts possibly the key.
Step in the right direction
Today’s intention to list news from Raspberry Pi could mean an end is in sight to London’s IPO drought, said Susannah Streeter, head of money and markets at Hargreaves Lansdown.
“This development marks a significant step of progress and shows that efforts to persuade more companies to list are bearing fruit.
“It represents a coup for London, particularly given the reputation the UK is trying to foster as a breeding ground for tech startups.”
Confirmation of the listing plans is “fantastic news” as the addition of an established technology company “is exactly what the UK market needs to hopefully open the flood gates for more tech firms to list in London,” said AJ Bell investment director Russ Mould.
He said the company has good characteristics that might pique investor interest, such as a large community of users and profitability, but investors will want to see more information in the prospectus such as the outlook for growth and dividends, plus key risks.
“The answers will come in time, but the mere news of the IPO is enough to build on the goodwill that is surrounding the UK market this year thanks to the FTSE 100’s long overdue revival,” Mould said.
IPO trickle
This is not the first IPO news of the year, with both European Green Transition and HeLIX Exploration completing AIM floats last month, following arrivals from Air Astana, MicroSalt and Sorted Group earlier in the year.
However, it is coming as the FTSE hits new highs and the Raspberry Pi announcement comes alongside recent reports that Chinese online retailer Shein is close to filing for a London IPO and hopes that Unilever might be persuaded to float its ice cream business on the LSE.
Speculation has also swirled about a potential Boots IPO, though recent rumours have focused on the potential for a private sale instead.
Other companies to have proposed or been rumoured to be looking at a float include The London Tunnels, Zilch and Zopa, though news has been quiet of late.
