A healthy number of lesser-known businesses have done very well in share price terms since coming to market in the last two years, with price appreciation reflecting strong operational performances or the fact they sate voracious investor appetite for a particular theme.

Readers will be familiar with high-profile post-pandemic newcomers on the London Stock Exchange (LSGE) trading above their issue prices, such as May 2021 debutant Darktrace (DARK).

Shares in the cybersecurity company have been volatile but are now more than double their 250p IPO issue price due to excitement over a possible private equity buyout, while late 2020 market newcomer and software reseller Bytes Technology (BYIT) trades 67% above its starting price.

However, many of the best performing IPOs may well have slipped under your radar, something this article is intended to address.

Sadly for the reputation of the LSE as a listing destination, other arrivals from 2020 and 2021 have proved disastrous, among them meals and groceries drop-off platform Deliveroo (ROO), online bathroom products purveyor Victorian Plumbing (VIC:AIM) and make-up brand Revolution Beauty (REVB:AIM).

Others have become members of the dreaded ‘90% club’; cash-strapped home furniture website Made.com (MADE), posh maternity-to-nursing wear brand Seraphine (BUMP) and direct-to-consumer ready meals play Parsley Box (MEAL:AIM).

RESOURCE PLAYS POWER HIGHER

Since the onset of the pandemic, spectacular gains has been delivered by penny shares such as Wildcat Petroleum (WCAT), the upstream petroleum industry investment company that arrived on the Main Market in December 2020.

Working on opportunities in Africa, the company, advised by the ‘shellmeister’ Michael Edelson, is seeking to acquire projects or a business operating in the upstream sector of the petroleum industry and has identified opportunities to use Blockchain in its business.

Also flying high is oil and gas investor Kistos (KIST:AIM), the late 2020 AIM float which has risen 460% against a backdrop of commodity price strength and hopes a potential merger with North Sea gas rival Serica Energy (SQZ:AIM) would come to fruition. Despite the industrial logic of a tie-up, Kistos’ overtures were resisted by Serica, yet Kistos’ board remains confident in the company’s strategic direction and ‘positioning as an independent North Sea gas champion and proactive consolidator in the sector’.

Other stellar share price performers include Critical Metals (CRTM), the mining investment company established to target opportunities in the critical and strategic metals sector, bid up 275% to 18.75p, while Bens Creek (BEN:AIM) has surged 242.5% above its issue price to 34.25p. The company owns a metallurgical coal mine in North America supplying the steel industry and its rate of production continues to increase month on month.

ELIXIRR OF SUCCESS

Elsewhere, shares in Elixirr International (ELIX:AIM) are up the best part of 225% since the challenger management consultancy debuted on AIM in the summer of 2020 at 217p.

Growing fast, in particular across the pond, Elixirr’s pre-tax profits increased by 109% to £12.2 million in 2021, on turnover up 67% to a record £50.6 million, as over 80 new clients were brought on board and the company maintained high levels of client retention.

Though the name will be unfamiliar to some readers, Elixirr has worked with heavyweight clients including Tesla (TSLA:NASDAQ), Bank of America (BAC:NYSE), ASOS (ASC) and Mars and is backed by respected fund manager Mark Slater.

Despite prevailing geopolitical uncertainties, the consulting firm’s directors, including CEO Stephen Newton and former BT (BT.A) boss Gavin Patterson in the non-executive chair, expect further growth in revenue and adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) during 2022.

FRP ON THE FRONT FOOT

Also flying high is FRP Advisory (FRP:AIM), which specialises in corporate restructuring and helps businesses navigate the process of going into administration or liquidation.

Its shares have more than doubled from their 80p issue price to 166.5p amid a rise in the number of insolvencies and administrations since the start of 2022. Guided by CEO Geoff Rowley, FRP has a track record of growth regardless of the economic conditions and appears well positioned to benefit from a surge in activity in the years ahead. Results (22 July) for the year to April 2022 revealed a 21% revenue increase to £95.2 million with adjusted underlying EBITDA up 12% to £25.7 million.

On 18 August, Liberum Capital, which has a 185p price target on the stock, enthused: ‘FRP has beaten on guidance in each of the last two financial years since coming to market, despite less than ideal market conditions.

‘We are excited to see what the business can deliver now that government life support has been turned off for UK companies. We believe the number of administrations could double from here if volumes returned to post-Great Financial Crisis levels but could even exceed that, with challenges faced by firms arguably greater now than a decade ago.’

CALNEX PASSES THE TEST

Shares in little-known telecoms testing kit maker Calnex (CLX:AIM) have climbed 225% to 156p since the Linlithgow-headquartered company braved pandemic markets by listing its shares on the AIM market in September 2020 at 48p.

A global leader in the telecoms network testing space, Calnex’s distinguished list of customers includes BT, Ericsson (ERICB:ST), Nokia (NOKIA:HEL) and Intel (INTC:NASDAQ) and share price strength comes against a backdrop of continued high demand for the company’s range of test and measurement solutions.

Calnex is benefiting from supportive market trends with the transition to 5G and growth in cloud computing, the order book remains strong and the company’s broad spread of products and global markets clearly has appeal for investors.

Full year results showed another strong year for Calnex, with revenue of £22 million coming in 8.9% ahead of Cenkos’ £20.2 million forecast and pre-tax profit up 64% to £6 million. As the broker commented on 24 May, ‘the long-term macro driver of the transition to 5G and continued growth in cloud migration is also expected to continue to drive demand from both new and existing customers and the record order book as Calnex entered full year 2023 provides a strong outlook with continuing strong sales momentum’.

Other small cap newcomers to have performed well include Helium One Global (HE1:AIM), a late 2020 arrival whose shares are up 172.9% on their IPO price, Arrow Exploration (AXL:AIM), whose shares have risen by almost the same amount, and Cornish Metals (CUSN:AIM), up 160.7%.

The first of this trio is a Tanzanian explorer whose prospecting licences give it the potential to become a strategic player in resolving a supply-constrained helium market, while the second name has a portfolio of premier Colombian oil assets it insists are ‘underexploited, under-explored and offer high potential growth. Shares in the third name, Cornish Metals, have stirred on excitement over its South Crofty project, which covers the former producing South Crofty tin mine located beneath the towns of Pool and Camborne in Cornwall.

Also meriting mention are under-the-radar names including Fonix Mobile (FNX:AIM), a mobile payments and messaging provider and dividend payer whose shares have doubled since flotation in October 2020. Steered by CEO Rob Weisz, Fonix’s sales and profits continued to grow in the financial year to June 2022 and the company continues to generate strong underlying cash flows.

In a recent trading update (21 July), Fonix claimed ‘a growing pipeline of client prospects across all sectors and markets’ - existing blue chip clients range from ITV (ITV) and BT to Children in Need.

NORTHCODERS HEADS NORTH

Also delivering positive news and trading north of their IPO issue prices are Northcoders (CODE:AIM), a provider of B2B and B2C coding and software development training seeing demand at record highs.

Ashtead Technology (AT.:AIM), the subsea equipment rental provider, is profiting from increased demand in both the offshore renewables and offshore oil and gas markets and the increased focus on energy transition and energy security. Its shares are up 39% from their AIM debut price.

And though the shares have fallen from February’s 83p peak a recent 60.5p, Facilities by ADF (ADF:AIM) remains 21% above its 50p issue price and hasn’t disappointed since becoming the first company to come to market in 2022. Facilities by ADF, which provides premium serviced facilities to film and high-end tv sets in the UK and counts the likes of Netflix (NFLX:NASDAQ), Apple (AAPL:NASDAQ) and Disney (DIS:NYSE) as clients, made quite the entrance with strong maiden annual results (26 May) as a public company and posts first half results on 13 September.

In its pre-close update (4 Aug), Facilities by ADF insisted ‘market dynamics remain strong, with continued robust demand for film and high-end television the UK and the group’s 2023 order book continues to grow. Therefore, the group remains confident of further success.’

Reflecting on the annual results, Cenkos said: ‘In our view, ADF represents a unique investment opportunity, due to a lack of alternative UK publicly listed companies offering exposure to the rapidly growing UK Film & TV industry. Whilst facility vehicles represent a small proportion of overall production costs (circa 2%), they are essential for a successful production, and a critical timeline element in the production supply chain.

‘Mega-cap US streaming companies are responsible for much of the demand-side of the equation, but most are not pure-play investments on the theme. On the supply-side, none of ADF’s competitors are listed.’

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