Although 2021 will be remembered as a year in which businesses struggled to cope with the macroeconomic and financial effects brought on by the Covid-19 crisis, the initial public offering (IPO) market last year was as active as ever. At the heart of this IPO market activity was the UK.
The introduction of new listing-friendly rules in March 2020 together with the reduced minimum public ownership level from 25% to 10% has ensured the UK retained its position as one of the most attractive locations to grow and list successful companies. 2021 turned out to be a record year for IPOs in the UK, with 108 companies listing on the stock market (more than the whole of 2019 and 2020 combined) and several standout names which have and caught the attention of retail and institutional investors worldwide.
This article will look at the top five most successful UK IPOs of 2021, predominantly measured by share price performance since their initial listings, and consider their future prospects in light of both the ongoing Covid-19 crisis and the health of the UK economy.
#1. Trustpilot Group PLC (LON:TRST)
Trustpilot is a Danish consumer review website which hosts reviews of businesses worldwide. As the first EU-based company to list in London after Brexit, it acted as one of the first signs that London was still an attractive venue for continental companies following its departure from the Union. Trustpilot’s shares rose as much as 16% on its first day of trading in London from its IPO price of £2.65, which raised £473 million. Since then, price action has been varied but the stock ended 2021 over 20% higher than its March reference price.
With the increasing threat of further restrictive measures being imposed by governments across the world, Trustpilot’s online platform could be in high demand. Such constraints would likely force people to spend more time at home, surfing the internet and consequently give rise to increases in the businesses’ popularity.
#2. Auction Technology Group PLC (LON:ATG)
Founded in 1971, Auction Technology Group has grown to operate seven of the world’s leading curated auction marketplaces and proprietary auction platform technology. The London-based firm debuted in February priced at 600p a share. Since then, the stock has more than doubled in value to 1516p, giving the company a market capitalization of over £1.6 billion.
With the emergence of the Omicron variant, it is likely that people will spend more time indoors and, as was the case in the first national lockdown, this is also likely to result in higher demand for online and digital auction services. As such, the Auction Technology Group’s share price rise looks set to continue in the near future.
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#3. Bens Creek Group PLC (LON:BEN)
Bens Creek Group is an AIM-listed holding company set up to own and operate metallurgical coal mines used for steel-making. In October, the business went public in what turned out to be one of the most successful UK IPOs of 2021. After soaring above its IPO price in the first few days of trading, the company’s stock has yielded more modest returns over the past few weeks, closing at 32p on 31st December, over 200% from its initial listing price.
The impressive performance of Bens Creek Group’s share price is largely down to the rising demand for metal witnessed throughout 2021. The company’s investment prospects in 2022 are therefore highly dependent on whether this demand will hold, as well as the success of its new mining project ‘Ben’s Creek’, located in West Virginia in the United States.
#4. Oxford Nanopore Technologies PLC (LON:ONT)
Oxford Nanopore Technologies is a UK-based company which develops nanopore sequencing products for the direct, electronic analysis of single molecules. After raising £3.4 billion through its IPO at the end of September, the company’s share price endured a bit of a rocky patch on the first few days of trading. Oxford Nanopore Technologies’ stock since then though has been on a general uptrend, with major price increases throughout November.
Oxford Nanopore Technologies has a consensus rating of ‘buy’ going into the new year, with an average price target of 737p; 74% above its IPO reference price. The optimism around the British-based company is largely down to its work on Covid sequencing and lateral flow tests for the NHS. In addition, the firm has diversified its products, services and operations across a wide variety of uses, which will help limit its risk exposure to any one market.
#5. Moonpig Group PLC (LON:MOON)
Although this final IPO has been somewhat unsuccessful in terms of share price performance since its initial listing as a public company, its inclusion in the top 5 UK IPOs of 2021 is purely on the basis of its expected price action in 2022. Since its IPO in February, Moonpig, a UK internet-based business selling personalised greeting cards and gifts, has suffered consistent losses in its share price. Despite its negative stock price movement, the positive macroeconomic trends surrounding Moonpig and the greeting card industry in general indicate demand for these products is likely to increase sharply over the next few weeks as people buy cards for the festive period, Valentine’s Day and Easter.