If you listened closely this autumn, you might just have heard it: the faint but unmistakable hum of a market engine turning over after a long stall.
The UK’s new issues market, left idling for much of the past few years, has finally shown signs of movement, not a roar but certainly more than a cough.
According to Peel Hunt’s latest “IPO Speedometer”, the market has shifted into what the broker calls “third gear”, signalling that conditions are now considered “open” for flotations.
The gauge has risen to 32mph in November from 28mph in September, its first outing in this new bracket. That reflects an uptick in activity since the summer, with five flotations pricing since October.
The standouts have been Princes Group and Shawbrook Group, each arriving with valuations north of £1 billion, the sort of scale that had been absent since 2021.
Princes’ £420 million all-primary deal is the largest UK listing in four years, although its aftermarket performance has dipped slightly.
Shawbrook, the specialist lender, has fared a little better since its £348 million float. Elsewhere, Beauty Tech Group, Winvia Entertainment and a dual listing from Fermi have added variety to the revived calendar.
Flotation discounts, which describe the gap between the IPO price and an estimate of fair value, have broadly sat between 10% and 25%, which is typical in cautious markets.
A few themes stand out. Domestic investors have shown up in decent numbers, although with noticeably smaller orders than in past cycles. International buyers, especially from Europe and the US, have filled some of that space.
Pricing ranges have narrowed too. Historically, companies and their advisers have offered a 20 to 30% range; the latest deals have been tighter, giving investors less latitude but improving execution certainty.
Conditions in the wider market have also helped. Equity indices around the world are hovering near record levels. The FTSE 100 is among the strongest performers globally this year, powered by large caps in defensive sectors such as energy, mining and financials.
The FTSE 250, more exposed to domestic sentiment, has lagged but still sits ahead by 7% this year. Market volatility, a critical factor for IPO appetite, remains below the psychological threshold of 20 on the commonly used VIX and V2X gauges, a sign that investors are not bracing for turbulence.
There are caveats. UK equity fund outflows spiked in September and October, totalling nearly £2 billion.
Peel Hunt attributes the rush partly to investors crystallising gains ahead of the looming November Budget, with expected tax changes prompting pre-emptive selling. It means many domestic funds have had less room to take chunky positions in new issues.
Despite the recent activity, the year is set to end quietly. Budget uncertainty, the Thanksgiving slowdown and the usual December lethargy are expected to mute further issuance.
First half 2026 looks livelier, with a broad set of companies watching for the next viable window. Names tipped in the press include Starling Bank, Zopa, OakNorth and Loveholidays, alongside a mix of financial, technology and international issuers.
Whether this is the start of a proper reopening or just another false dawn is hard to call. For now, the signs are constructive.
Deals are getting done, valuations are not outlandish and investors appear willing, if still choosy. After the drought of the past few years, even a measured drizzle is welcome.