IPO woes: Can LED face masks and tinned tuna IPOs revitalise London?
The City heaved a sigh of relief on Friday morning, as two companies ploughed ahead with their plans to list on the London market, signalling that an IPO drought that has long plagued the London bourse may soon come to an end.
The Beauty Tech Group announced the successful pricing of its initial public offering at 271 pence per share, as well as confirming that they will begin trading conditionally on 3 October.
It made a promising debut, with shares rising by as much as five per cent above its initial offering on Friday.
Chief executive Laurence Newman said the IPO was “the perfect platform” for the business to deliver “sustained and profitable growth”.
The Liverpool-based company also hailed the decision as key to executing their M&A ambitions, expanding their portfolio and extending their international reach.
Elsewhere, tinned tuna giant Princes confirmed its intention to register to float on the London Stock Exchange, calling it “a natural next step”.
Dan Coatsworth, head of markets at AJ Bell, said: “The UK stock market has been starved of new blood in recent years, with IPOs being thin on the ground.
“It’s therefore encouraging to see activity levels start to pick up. Investors are keen for new stock ideas and two new listings have the potential to grab the market’s attention.”
Chris Beauchamp, chief market analyst at IG, echoed this sentiment, noting it was promising to see “two diverse companies wanting to list in London”.
While the two companies’ intentions suggest an encouraging build in momentum for the capital, questions are forming over whether the shine will last or if investors will eventually lose interest and turn their eyes elsewhere.
Princes and the cost-of-living crisis
Princes, which was bought last year by Italian food company Newlat, is a well known company in the UK. Aside from its notorious tinned tuna it also owns a host of familiar brands including margarine brand Flora and Branston pickle, which are also a staple of many British households.
Coatsworth acknowledged that a company “with energy and brand strength” is what the stock exchanges needs, however the ongoing cost of living crisis could damage its potential for growth.
He said: “Rachel Reeves’ November Budget has the potential to bring bad news for consumers and businesses if the tax system is tweaked to help fill a black hole in the public finances.”
“Confidence levels could be knocked and spending curbed. Princes could be the victim of grocery product substitution, and that would be a terrible start to life as a UK listed entity.”
However, Princes chief executive Simon Harrison has laid out a clear growth plan for the company to secure long term profits, including expanding its range of products and tapping into the drinks market.
These long term ambitions could make the company attractive to investors, but a failure to do so could lead them to invest elsewhere.
Beauty space competition
Beauty Tech gives London investors the opportunity to tap into an up and coming sector, allowing them to secure a chance to invest in the latest skincare treatments, such as LED masks, which are becoming increasingly popular on social media.
However, the company is one of several players who are vying for dominance in the space, leaving them with large numbers of competitors to contend with to win over both investors and consumers.
Coatsworth said: “Within the first 30 minutes of trading, the share price moved up to 285.2p. The challenge is to sustain that momentum.”
“Beauty Tech has a compelling narrative but there is plenty of competition in that space.”
IPO revival: Is the tide turning in London?
While the future of Princes and Beauty Tech relies on their performance over the next few months, more companies are looking to the UK markets as a home.
Potential candidates over the next few months and into 2026 include Boots, card reader provider SumUP and online travel agent Loveholidays. Mid-sized lender Shawbrook is also reported to be close to confirming its intention to float.
Companies are being lured to London by the growing willingness of the government to support capital markets, bolstered by the rumours the Treasury is considering slashing the 0.5 per cent stamp duty on shares.
Meanwhile, wider market volatility from Trump’s tariffs have made the Nasdaq less appealing, while other European markets have also experienced a slowdown, making London a more desirable destination.
Beauchamp said: “IPOs it seems are like buses, no sooner have the articles about the death of London as a destination appear, than we get four in one week.”