In 2023, only three companies in Germany – Ionos, Thyssenkrupp Nucera, and Schott Pharma – went public in the Prime Standard. Based on data from the strategy consulting firm Kirchhoff Consult, this is two more than in the previous year where only Porsche AG went public. However, it is significantly fewer than the long-term average since 2010 of seven IPOs. The total issuance volume significantly decreased to 1.9 billion euros (compared to 9.1 billion euros in 2022), marking the second-lowest value in the past ten years and the lowest since the pandemic year 2020. In 2022, Porsche AG had the second-largest IPO ever conducted in Germany, while this year, no IPO achieved a billion-euro profit.

The stock performance of the three IPO newcomers in 2023 has been consistently negative since their debut. On average, the stocks lost 15.6% (as of November 30, 2023). This continues the trend of previous years, where only 38% of companies going public in the Prime Standard since 2019 experienced stock gains in the IPO year. In contrast, the DAX 40 gained 16.5% during the year (as of November 30, 2023). Despite rising interest rates, economic weakness, and international conflicts, stock prices remained robust.

In the US, the British chip designer Arm, food delivery app Instacart, and email marketing specialist Klaviyo raised hopes for a rekindling of the IPO market in September after a year and a half of stagnation. However, their stock performance was at best mixed. Even the German traditional company Birkenstock flopped in its debut in New York.

So, hope is now directed towards 2024. In Germany, the perfume chain Douglas from the portfolio of financial investor CVC and the long-distance bus operator Flix with major shareholder General Atlantic are preparing for an IPO. Techem, the heating meter reading company, and Stada, the generic drug conglomerate, might transition to the stock market from private equity ownership. Also mentioned are fuel card provider DKV Mobility and HR software company Personio.

Following Birkenstock's move to list in the US, market participants are concerned about a similar occurrence with the most valuable German software company, the "unicorn" Celonis. "The choice of the stock exchange should be carefully considered. Various factors play a role in the final selection," says Christoph Heuer, Managing Director and Co-Head Equity Capital Markets Northern Europe at BNP Paribas. "These factors can be viewed differently from the perspective of management and existing shareholders. However, the group of peer companies remains the same regardless of the choice of the stock exchange."

"The reasons for the persistently weak IPO market are less related to the development of the stock market, which performed strongly, especially in the first half of the year and in November", notes Jens Hecht, Managing Partner at Kirchhoff Consult. "More important were high political uncertainties, rising interest rates, and the weak overall economy. Investors, therefore, acted very cautiously."

"The IPO environment was very challenging in 2023 because investors lost their appetite for risk. Only Schott Pharma had a perfect start. Cornerstone investors (such as Qatar) can help build additional confidence in an IPO", observes Heuer.