Will 2025 IPOs Limbo Beneath Record Low Set in 2024?

COMMODITY CAPERS: HLB Mann Judd has been completing its annual IPO Watch for 20 years, in which time it has not seen such a dire result as that presented by 2024.

The advisory and accounting firm found that 2024 recorded just 29 new ASX listings, fewer tha 2023 which produced just 32 IPOs, a result market watchers considered then to be disappointing.

“The poor listing volumes are reflective of another challenging year in which there have been significant macro and political factors globally, and upcoming policy uncertainties in relation to the incoming US administration from the end of January,” HLB Mann Judd partner corporate & audit services Marcus Ohm said in the report.

Ironically the record low number of 2024 listings produced a higher total raising of funds, a 387 per cent increase to be precise of $4.1 billion, a decent jump on that delivered in 2023 of $847 million.

This was attributed to the eleven large cap listings in the year. HLB Mann Judd puts companies with a market capitalisation above $100 million in the large cap grouping. The eleven bigger cap companies contributed 96 per cent of the total funds raised.

There was only one large cap listing in the Materials sector in the year being Metals Acquisition Limited (ASX: MAC) which listed in February raising $325 million.

Elsewhere across the sector the ASX welcome another 12 entrants. The total of thirteen representing the highest number of listings in the year. Irony bit again, however, with new Materials listings representing only 45 per cent of total listings, down from 72 per cent in 2023 as conditions for battery metals listings proved difficult.

It should be of no surprise that the Materials sector has historically recorded the most new listings, a rosette the sector maintained to display proudly in 2024.

There are, however many headwinds for the sector to battle, none more so than the lack of funds that seem to be available from the investment community.

More companies on the boards means more competition for that all important investment dollar and these days, as opposed to the mad times when those with the keys to the safe would throw money at anything, punters are far mor circumspect when it comes to taking the plunge, which is usually from the lowest springboard as opposed to the 10 metre tower.

Ohm was more prudent when presenting his thoughts on the matter, saying “This reflects unsupportive market conditions for junior exploration listings resulting in a marked decrease in the number of successful Materials listings.”

Gazing into his crystal ball, Ohm indicated there to be only three upcoming listings raising new capital on ASX as at 4 January 2025, which he suggested was a fair indication there won’t be an immediate uptick in IPO activity in the first quarter of the 2025.

“Conditions remain challenging in the IPO market at present and any marked improvement is likely be in the second half of 2025,” he said.

“The effects of a change in presidency in the US also present a potential impact on both the Australian and global markets in 2025.”