The main market had just two IPOs, raising a total of £63m, while the Alternative Investment Market (AIM) had three admissions, raising £18m. This performance represents a significant decline compared to the same period in 2022, which had 12 main market IPOs and seven AIM admissions raising a combined £0.4 billion.

Scott McCubbin, EY UKI IPO leader, attributes the challenging market conditions to ongoing geopolitical tensions, high energy and commodity prices, and inflationary pressures.

He said: “We expect the market to remain challenging for the next few months, albeit with some green shoots in the form of an expected reduction in inflation by the year-end. This should help see a return to a stronger equity market later in the year. However, this remains at risk given the continued uncertain geopolitical landscape.”

Global IPO activity has also seen a downturn, with proceeds raising $21.5bn across 299 IPOs in Q1 2023. This is 8% lower in terms of the number of IPOs and 61% lower in terms of proceeds when compared to Q1 2022.

Technology companies, which have been a mainstay of IPO activity in recent years, experienced some notable declines in valuations. This has been driven by high inflation and investor demand for profitability over growth and intensified by the recent market turbulence in the global banking and crypto markets.

While the technology sector continued to lead in terms of IPO volume, four of the top 10 listings in Q1 2023 were in the energy sector.

SPAC IPO activity hit a six-year low in Q1 2023, and the Asia-Pacific IPO market, which accounted for 59% of global IPO deals, also saw activity decline. Debbie O’Hanlon, UK&I private leader, expects the market to remain challenged in Q2 2023 but suggests that investor confidence may return once market stability is evident.