The falling number of companies on AIM will bottom out during the second half of the year, according to new research.
The junior market has seen its listed firms decline for 30 consecutive months but this is set to level out at around 1,200 companies, according to Deloitte.
Darren Boocock, corporate finance partner at Deloitte in Birmingham, said: “The past six months have displayed positive characteristics compared with those seen this time a year ago, with a definite uptick in the numbers of companies listing.
“There has been a steady increase in the levels of activity with the second quarter of this year seeing 18 new listings, compared with just eight in the same period last year. This is an increase from the 16 new admissions we saw in the first quarter.
“This has coincided with the rate of companies leaving the market slowing in recent times, meaning that we may shortly see an end to the long decline in the number of listed companies on AIM.
“Trends in recent activity suggest that only once the total number of companies reaches the 1,200 mark, a drop of almost 30 per cent from its peak of 1,694 in December 2007, will the numbers of companies listing and level of activity rebound and begin to increase again.
“The point at which this low watermark is reached and the market is subsequently perceived as returning to growth will clearly be a positive development for the AIM market, and will herald increased levels of confidence for investors and companies alike, proving a positive indicator at the start of 2011.”
