It has been well over a year – in fact more than 535 days – since the Warsaw Stock Exchange last saw an IPO. On December 10, 2021, STS Holding, a sports betting company, made its PLN1.1bn (€240mn) debut, rising 3% as the day’s trading closed.

Two months later, Russia began its invasion on Ukraine. The ensuing energy crunch, the inflation that it caused, the economic slowdown that followed in the wake of those crises – and the National Bank of Poland’s interest rate rises to keep price growth at bay – all made the Warsaw bourse fall asleep.

Now, as there begins to be some cautious optimism over the future course of the war and, internally, Poland’s economic downturn may have just bottomed out, while inflation fell nearly 4pp in three months between February and April, there are hopes that the WSE could regain at least some of its former gloss. And what better way than a major IPO?

Investment fund CVC is said to be planning to float its convenience retailer Zabka, a brand that has become ubiquitous countrywide thanks to its more than 9,000 stores, offering basic groceries, hot snacks, and coffee.

An IPO of Zabka, a company with PLN18.5bn annual revenue in 2022, would be a shot in the arm for the WSE, which recently has only seen companies moving from the alternative market NewConnect to the main floor.

Even that second tier of Warsaw’s market has been ailing. In the first quarter there only were two NewConnect-originating debuts on the main market, their combined value a mere PLN3.6mn. That compares unfavourably to Q1 2022 – which was anyway feeble – of three debuts worth PLN16mn, according to a recent report by consultancy PwC.

"Another quarter of stagnation means that the IPO window may appear even later, possibly in the second half of 2024,” Kamil Wardzynski, a senior manager in the capital markets team at PwC’s Polish office, said in the report.

Aside from the IPO drought, the performance of the WSE has not all been doom and gloom. A weekly survey of individual investors’ sentiment, known as the INI, has been at a long-time high, with just over 70% of respondents hoping for a bull market in the next six months. Just 14% expected a bear market.

WSE trading has been particularly positive for companies from (relatively) new sectors such as biotechnology or photonics, according to participants at a recent debate on the WSE’s future organised by Poland’s leading business newspaper Puls Biznesu.

“Both industries resemble newborn babies that currently require protection and support but raise expectations associated with growth and future successes,” Adam Piotrowski, CEO of Vigo Photonics, told Puls Biznesu.

“Their presence in the stock market, compliance with regulatory obligations and reporting confirms this. In this context, the role of the stock exchange is to generate interest in them among both domestic and foreign investors,” Piotrowski said.

Despite these positives, the outlook for the bourse remains unclear, clouded for the most part by political uncertainty.

“A significant factor influencing the market this year, as well as the beginning of the next, will be the parliamentary elections in October, which undoubtedly will be closely observed - and perhaps cause restraint - among investors," Wardynski said.

Politics aside – if that is ever doable – the WSE has recently unveiled its strategy for the years 2023-2027.

In line with the strategy, the WSE plans to achieve average annual revenues of PLN498mn (compared to around PLN400mn in the preceding five years) and average annual Ebitda of PLN215mn. Revenue in 2027 is planned to increase by PLN157mn compared to 2023, of which PLN101mn will be attributable to “new strategic initiatives,” the bourse said on May 26.

“Under [the] previous strategy, core business and new initiatives were of equal importance. According to the new strategy, it is 80% core business and 20% new business lines,” Marek Dietl, president of the WSE’s management board, told a press conference.

“We maintain a strong focus on our core business but in a completely new perspective. We will redefine it and develop it with new initiatives,” Dietl added.

“We [will] remain active in mergers and acquisitions. We are looking at technology companies, firms related to the capital market, cyber security, and the stock market industry,” Dietl also said.

The WSE plans to develop derivatives on the commodity and financial markets and to introduce new products on the markets it is developing such as trade in funds or commodities, as well as GlobalConnect, a platform for trading stocks listed on foreign stock exchanges.

The WSE also plans to make available useful data, including iXBRL (a standard for human-readable and structured, machine-readable data) structured company reports, ESG reporting and sustainable finance indices, as well as products dedicated for traders.

Important goals of the new strategy also include the launch of a market in tokenised non-financial assets, the GPW crowdfunding platform, and the Warsaw Integrated Digital Exchange.

On the technological front, the Warsaw Stock Exchange plans to further develop its solutions, including the proprietary trading system WATS, the TCA Tool application for analysing market micro- and macro-structure, and GPW STORK, a platform for market abuse detection.