Interactive Investor

Victorian Plumbing: AIM’s biggest ever IPO makes flying start

22nd June 2021 16:11

Graeme Evans from interactive investor

It’s been a strong start to the year for new companies joining AIM, and Victorian Plumbing delivered big gains for shareholders on Day One. 

A bumper year for AIM admissions got even better today when Victorian Plumbing made its £850 million debut in the junior market's biggest ever flotation.

The online bathroom retailer, which chief executive Mark Radcliffe set up from a shed in his parents' garden two decades ago, got off to a fast start when shares rose from their opening price of 262p to as high as 329.35p. They later settled at 322p.

The Formby-based business has grown rapidly in recent years and now operates in a market estimated to have been worth about £1.4 billion in 2020. Its fortunes received a further boost during the pandemic thanks to the structural shift towards online channels, leading to revenues of £140.7 million and adjusted earnings of £20.1 million in the six months to 31 March.

Victorian Plumbing's admission to trading on AIM follows the significantly over-subscribed placing of shares with institutional investors, a process that raised £258.9 million for selling shareholders including Radcliffe and his family. They still retain majority control.

Radcliffe said prior to the flotation that it had been humbling to see the City's overwhelmingly positive reaction to the listing. He added: “We are thrilled to have reached this milestone. It is a testament to the dedication of our fantastic employees who have helped build this unique and trusted brand.”

His company is the latest in a long line of well-known names to have joined the London market so far this year, including Dr Martens (LSE:DOCS), Moonpig (LSE:MOON), Deliveroo (LSE:ROO) and (LSE:MADE).

The majority of London's newcomers have got off to strong start as investors with cash piles to deploy after the pandemic rush to get involved at a time of low interest rates.

Liberum estimated last week that the IPO proceeds of £7.5 billion in the first five months of this year was neck and neck with 2011 and in line with the figures across all of 2018 and 2019.

The Victorian Plumbing flotation is the biggest by far on AIM and comes with the number of new admissions on the junior market already at around the same level as the whole of 2020.

As interactive investor's Andrew Hore reported last week, the pipeline of potential AIM admissions also looks promising with high street retail software supplier itim and North Sea-focused oil and gas company Orcadian Energy due in the next month.

Others to watch out for include digital marketing services provider Silver Bullet Data Services and Future Biogas, which develops and operates anaerobic digestion plants creating clean biogas. It has previously sold on projects to investors such as JLEN Environmental Assets Group (LSE:JLEN), but management wants to build up its own portfolio of assets.

The strongest performing AIM newcomers so far have been 4basebio UK Societas (LSE:4BB), bars operator Nightcap (LSE:NGHT) and Cornish Metals (LSE:CUSN), which is resurrecting the South Crofty tin mine in Cornwall.  

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.