The Deloitte IPO Barometer
IPOs continue to outperform FTSE 100
The 16 IPOs that have completed so far this year generated an average return of 17.8% according to Deloitte, the business advisory firm. Year to date, these IPOs have outperformed the FTSE 100 by 18.4 percentage points.
John Hammond, head of equity capital markets at Deloitte, said:
“In a half year that has seen the FTSE reach all-time highs in April and a big weekly fall in early June, it is encouraging that the cohort of 2015 IPOs have performed so strongly. As we have seen for the last few years now it is largely UK PE-backed businesses that are successfully listing in London, indicating that IPO valuations remain attractive both to PE shareholders and investing institutions.”
An investment of £1,000 in each of the 16 IPOs is now worth £18,855, whereas a £1,000 investment in the FTSE 100 at each IPO date would have fallen slightly to £15,915.
Chris Nicholls, head of IPO and equity advisory at Deloitte, adds:
“Against the backdrop of the General Election here and particular concerns surrounding the potential Grexit, the outperformance of IPOs is significant. IPOs had performed strongly even before the General Election and the result relieved political and market uncertainty, providing a further boost to performance. Overall, we believe that sentiment is positive and the IPO pipeline for the rest of the year and into 2016 is as strong as ever, with consumer and financial services businesses in particular leading the way.”
IPOs as referred to above are defined as London Main Market Listings of shares for trading companies (i.e. investment companies, venture capital trusts, transfers from other markets, cash shells etc. have been excluded).
The performance figures reflect share price movements only, take no account of dividends, and are not a measure of total shareholder return. Issue price used in calculation is as at date of Admission and is based on performance relative to the FTSE 100 from date of admission to period end.
Past financial performance is not indicative of future performance, individuals must therefore seek appropriate advice before investing in IPOs.
Source: Company Prospectuses, Company press releases and LSE information at 23 June 2015. Ppt refers to percentage point movement between the FTSE 100 and individual share performance.