EY: Market uncertainty and investor caution stalls IPO activity on London Stock Exchange
The London Stock Exchange saw nine new listings in the first half of 2025, as heightened geopolitical turbulence continued to dampen market activity.
The nine listings raised £182.8m in total, a 64% year-on-year fall in deal value from the £513.8m raised in H1 2024. Three of the listings were on the main market and six on the Alternative Investment Market (AIM). In Q2, there were four listings – one on the main market and three on AIM – which raised £108.1m, a 52% decline on proceeds raised in Q2 2024.
Scott McCubbin, EY-Parthenon UKI IPO Leader, comments: “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.
“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 £7.5 bn 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.”
Global IPO market sees patchy start to 2025
In the first half of 2025, the global IPO market recorded approximately 540 deals, raising nearly US$62bn – flat year-on-year (Y-o-Y) in terms of deal volume, but reflecting a 17% increase in total proceeds.
Asia-Pacific led the momentum with solid growth, while the Americas remained stable. In contrast, Europe and India experienced declines, whereas the Middle East stood out with robust expansion. The US, India, and China accounted for two-thirds of global IPOs, with half of the proceeds raised in the US and China.
In Europe, IPO activity faced declines as most major European markets paused amid market turmoil. With deal volumes down 24% Y-o-Y and proceeds falling 60% Y-o-Y to US$5.9bn, the market has become increasingly selective, placing greater emphasis on profitability and resilience as key criteria for going public.
Grant Humphrey, 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.”
Industrials sector dominates H1 2025 global IPO activity
The industrials sector led all sectors in IPO issuance, capital raised, and growth performance in H1. The growth was largely driven by the mobility sub-sector and IPOs from India, Greater China and South Korea. Geopolitical tensions and supply chain risks have accelerated reshoring and friend-shoring, driving investment in domestic manufacturing and advanced technologies.
The technology sector saw a 19% increase in total capital raised compared to the same period last year. Investors are being increasingly more selective on profitable and proven tech companies, particularly in AI-related sub-sectors. The US continued to attract software companies with volumes more than doubling compared to H1 2024.