Peel Hunt hints at rebound in London IPO market after ‘difficult’ year
Losses at Peel Hunt have doubled over the past year, but the investment bank hinted at a rebound in the City following a slew of companies leaving the UK financial markets.
The company reported a pre-tax loss of £3.3 million in the year to the end of March, greater than the £1.5 million loss reported the previous year.
This was driven by subdued sales, inflationary pressures pushing up costs, and strategic investments made during the year, it said.
Peel Hunt cautioned that “difficult” financial markets and fewer companies launching fundraising, or initial public offerings (IPOs), had impacted its investment banking services.
A well-reported dearth of new firms listing on the UK’s public markets in recent years has led to UK ministers and the London Stock Exchange pushing to get businesses to float in London.
We are seeing tentative signs that a recovery from the lows of the last two years is under way
Steven Fine, Peel Hunt’s chief executive
This month, the markets were fired up by a hotly anticipated IPO from computing firm Raspberry Pi, which is targeting a valuation of about £540 million.
Reports that online fashion giant Shein is set to file for a London stock market listing also raised hopes in the City, which could value the firm at more than £50 billion.
Peel Hunt revealed that it supported two companies with their IPOs in the London market announced this month.
“We are seeing tentative signs that a recovery from the lows of the last two years is under way,” chief executive Steven Fine said.
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While the IPO market has not “fully re-opened”, UK investors are “increasingly receptive to high-quality companies,” the investment bank said.
Meanwhile, mergers and acquisitions have ramped up across the public markets as more firms place bids on undervalued UK assets.
The company said its revenues edged up by 4% to £85.8 million in the latest year.
Within its investment banking division, revenues swelled by nearly 40% year on year thanks to the uptick in merger activity and it advising more FTSE 250-listed clients.
Shares in Peel Hunt were down by nearly 5% on Thursday morning.