The London Stock Exchange (LSE) is showing clear signs of a significant recovery, with a surge in activity at the end of 2025 setting a positive trajectory for the year ahead. After a prolonged period of subdued listings, a flurry of Initial Public Offerings (IPOs) in the final quarter has injected new optimism into the UK's flagship financial market.
A Strong Finish to 2025
The revival became evident in the last three months of 2025, when the UK market welcomed 11 IPOs that raised a combined £1.9 billion. This late surge brought the total number of listings for the entire year to 23. Notable floats included household names like tinned tuna giant Princes and The Beauty Tech Group, the latter seeing its share price climb 6.2 per cent to 290p in a single month.
Overall, the nine listings on the main market and twelve on the AIM raised approximately £2.1 billion throughout 2025. This figure represents a staggering 170 per cent increase compared to the £777.7 million raised from IPOs in the previous year. However, analysts caution that despite this sharp revenue rise, overall activity remained historically muted, with the final quarter primarily responsible for the dramatic annual jump.
"After a turbulent start to 2025, marked by heightened geopolitical uncertainty and volatile market reactions to the introduction of trade tariffs, IPO activity gathered momentum towards the end of the year," explained Scott McCubbin, EY-Parthenon UK IPO leader. "The final quarter saw a notable acceleration in listings as companies moved ahead with postponed floatation plans, encouraged by stabilising market conditions and improving investor sentiment."
Regulatory Reforms Fuel Optimism for 2026
Building on this momentum, analysts predict a continued uptick in London's IPO pipeline for the first half of 2026. This optimism is heavily underpinned by recent reforms to the UK's listing regime, unveiled in the Autumn Budget by Chancellor Rachel Reeves.
The centrepiece of these reforms is a stamp duty exemption on shares of newly listed companies. The Treasury has scrapped the 0.5 per cent charge that investors previously paid when purchasing shares in new listings for the first three years following their IPO. This move, highly anticipated across the City of London, is designed to revitalise the domestic market, encourage more British investors, and stem the flow of listings to overseas exchanges like New York.
The decision was warmly welcomed by the exchange itself. Charlie Walker, deputy chief executive of the London Stock Exchange, hailed it as "the first sort of meaningful change" seen in the market for a long time.
Selective Investors and a Global Context
Despite the improving sentiment, the deal landscape retains an element of uncertainty. Persistent concerns around inflation and geopolitical tensions continue to create a cautious backdrop. Furthermore, investors have become more discerning, favouring high-quality companies with clear profitability roadmaps and resilient business models over speculative bets.
"Businesses considering an IPO should ensure they prioritise careful market timing, demonstrate operational resilience and present a compelling equity story to attract investor interest," advised McCubbin.
The revival is not confined to London. The global IPO market also stabilised in 2025, with 1,293 companies going public worldwide, raising $171.8 billion (£126.8bn). The Middle East, India, and Africa led in the number of transactions, accounting for 42 per cent of all deals. Meanwhile, the Asia-Pacific region dominated in terms of capital raised, securing 43 per cent of global IPO proceeds. India recorded the highest number of deals with 367 IPOs, followed closely by China with 222.
"Sentiment across the global IPO markets has improved over the course of 2025, supported by strengthening macroeconomic indicators, increased predictability in monetary policy and a broader base of investor demand," said Grant Humphrey, partner at EY-Parthenon. "If market volatility remains contained, the foundations laid in 2025 could underpin a meaningful expansion of IPO activity."
With a robust end to 2025, supportive government policy, and cautiously improving global conditions, the London Stock Exchange appears well-positioned to reclaim its status as a leading global destination for companies seeking to go public in 2026.
