AIM returns to pre-recession levels thanks to rush of IPOs

Models at Boohoo's US launch in March (Getty Images)

A boom in companies listing on AIM has helped London’s junior stock market return to growth for the first time since the recession, according to new figures.

The Alternative Investment Market, or AIM, has seen a net gain of 12 companies over the past year, the first time the index has grown in size since before the credit crunch, according to data from accountancy firm UHY Hacker Young.

The growth has been fuelled by a boom in businesses listing on AIM, with £2.4 billion raised through IPOs on the market in the last 12 months - nearly triple the £834 million raised the year before. The findings come as two more companies announce plans to join the exchange – life sciences company Abzena and US CV checking software maker ClearStar.

Colin Wright, a partner at UHY Hacker Young, said: “The return to growth of the market is very positive for AIM. It seems that businesses are now confident that listing on AIM will provide them with the investment needed to fund quick growth.”

Notable recent floats on the market, which is populated by smaller, high growth companies, include Patisserie Valerie-owner Patisserie Holdings and discount footwear retailer Shoe Zone. The biggest listing of the last year was Manchester-based online retailer Boohoo.com, which raised £300 million in April.

The resurgence of AIM is part of a wider boom in initial public offerings, as company’s rush to take advantage in the revived appetite among investors for new offerings. But concerns have been raised that the market is becoming saturated, with notable companies such as AA and Saga falling below their public offer prices.

Wright downplayed fears, saying: “Whilst the IPO market might be suffering from temporary indigestion we anticipate that investors’ appetites will fully recover after the summer break.”

Wright said the figures were: “a clear sign that that investor appetite for AIM shares is returning towards pre-recession levels.

“Investors are more willing to put their money into AIM listed companies than at any time over the past five years. They now appear to be more confident of a return on investment from these junior market companies.”