The UK’s travel and leisure sector has seen capital raising plummet by 75% in the face of intensifying economic turbulence.
Businesses in the sector raised a total of £531 million in the first half of 2022.
But the figure was down from £2.5 billion in in the second half of last year and £2.2 billion in the first six months of 2021.
The travel and leisure sector saw one of the largest drops when compared to the first half of 2021.
Concerns over growth and inflation were compounded by war in Ukraine and economic uncertainty,
Analysis of London Stock Exchange data on capital raising by investment bank Goodbody shows that the sector has already started to see the effects of inflation and rising costs, as purchasing power and consumer demand begins to wane.
This is despite output growth continuing to rise following the dwindling impact of the pandemic.
Just £5.7 billion in new capital was raised overall by UK listed companies, the slowest start to a year in nearly a decade.
Piers Coombs, head of Goodbody’s London office, said: “Those that are raising capital are mostly doing so on a needs must basis.”
He added: “Looking ahead, while it is impossible to say with certainty when activity will begin to pick up, our view is that this will happen once there is more clarity on the interest rate cycle in Europe and the US and, importantly, some visibility on inflationary pressures subsiding.
“The latter could reasonably come through in late Q3/Q4 this year, not least as we start to lap into higher comparatives from this time last year.
“IPO pipelines have moved, with the majority of active processes now targeting 2023 rather than the second half of this year.”