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IPO market looks set to get its groove back in 2017: Analyst

IPO market strong due to investor performance and appetite: UBS

Initial public offerings did not have a very good year in 2016 but that might be about to change, an analyst told CNBC on Thursday.

Economic and political uncertainties drove appetite for IPOs down by 16 percent year-on-year in 2016, according to EY.

But while this year has more political uncertainty with elections across Europe and a Trump presidency, there are fewer "definitive" dates in 2017 to avoid floating a company than there were in 2016, according to an equity analyst.

"Last year we had two real windows which was post-Easter/pre-Brexit and then post-summer/pre-Trump," Gareth McCartney, head of equity syndicate at UBS, noted.

He told CNBC on Thursday that there is "a huge amount of political risk" in 2017 "but big political risk doesn't necessarily mean risk off for equity assets and if I look at this year I see less definitive dates."

"The flow of business seems more stable" than in 2016, he added.

Possible IPOs in 2017 include: Snap Inc; the music stream platform Spotify; Uber and Dropbox.

In a global market with a structural shortage of growth, investors eye IPOs as for growth opportunities.

According to McCartney, investors are searching for "anything that is large so you have less liquidity concerns. Secondly anything that delivers demonstrable growth with a forward looking pattern. I think it will be well-received by the market as a whole."

Apart from a "pretty normalized" IPO market in 2017, McCartney told CNBC that "M&A volumes will pick up and I think we will see equity issuance associated with it so that is more growth orientated financing."

"We are going to see more in the banking sector in terms of recapitalization and given some of the regulatory changes," he added.

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