Key Takeaways:
- Canada’s IPO market is expected to revive in 2026, driven by renewed economic confidence and interest from companies in technology, natural resources, and other sectors.
- The number of IPOs declined in 2025 due to high interest rates, inflation, and regulatory hurdles, but bankers say companies are now expressing interest in going public.
- A strong IPO market is seen as a barometer for the overall health of the Canadian economy and a sign of confidence in the government’s pro-business agenda.
- New IPOs could help reverse a long-term trend of more companies delisting than listing on the Toronto Stock Exchange.
- The IPO pipeline is expected to be strong in 2026, with companies in consumer products, resources, fintech, and technology exploring potential listings.
Introduction to Canada’s IPO Market
Canada’s dormant market for initial public offerings (IPOs) is poised for revival in 2026, signaling renewed economic confidence that could help reverse a years-long corporate exodus from the country’s main stock exchange and validate the government’s pro-business agenda. After a four-year hiatus, companies in technology, natural resources, and other sectors are expressing interest in going public. This resurgence is expected to be driven by improved market conditions, including lower interest rates and increased investor confidence.
Factors Affecting the IPO Market
The number of IPOs declined in markets around the world last year, thanks to factors such as uncertainty over U.S. tariffs, market volatility, and high listing costs. Canada’s IPO market was especially hard hit, in part because of regulatory hurdles and a limited number of companies exploring new listings. However, bankers say that companies are now more confident about going public, and the IPO pipeline is expected to be strong in 2026. The revival of the IPO market is seen as a barometer for the overall health of the Canadian economy, and a sign of confidence in Prime Minister Mark Carney’s pledges to increase productivity and forge new trade and business partnerships around the world.
Impact on the Toronto Stock Exchange
The Toronto Stock Exchange, Canada’s main exchange, saw a decline in the number of listed companies in each of the past three years. There were only two IPOs in 2025, and a total of 55 delistings, largely due to deals to take companies private, along with mergers and acquisitions amid consolidation in the financial and energy sectors. However, the main stock index, S&P/TSX Composite Index, surged about 29% in 2025, outpacing the S&P 500’s 16% gain, helped by a rise in the valuation of the big banks and growth in mining stocks. This suggests that investors are eager to put their money into equity markets, even if companies have had their own reasons to avoid new stock listings.
Companies Exploring IPOs
Canadian firms exploring potential IPOs this year include companies in consumer products, resources, fintech, and technology, according to Peter Miller, head of equity capital markets at Bank of Montreal. Miller said that the IPO pipeline "is the strongest I’ve seen since 2021," and that his team at BMO is in talks with companies hoping to go to market early in the year. Royal Bank of Canada’s head of Canadian equity markets, Jackie Nixon, also said that there is a growing pipeline of private companies that want to go public at some point in time, and that they are working on a handful that they expect will go public in 2026.
Challenges and Opportunities
While the revival of the IPO market is a positive sign for the Canadian economy, there are still challenges to be addressed. Bankers say that they have been encouraged to hear that companies testing the public-market waters are mostly looking to raise large amounts of money. However, hurdles remain even after companies list shares publicly, as seen in the case of GO Residential Real Estate Investment Trust, which has lost about 25% of its value since its IPO in July 2025. Michael Ashley Schulman, partner at Running Point Capital Advisors, noted that what really matters is if operating company IPOs can actually trade well post-issue.
Conclusion
In conclusion, Canada’s IPO market is expected to revive in 2026, driven by renewed economic confidence and interest from companies in technology, natural resources, and other sectors. While there are still challenges to be addressed, the strong IPO pipeline and improved market conditions suggest that the Canadian economy is poised for growth. The revival of the IPO market is a positive sign for the country’s main stock exchange, and a validation of the government’s pro-business agenda. As the IPO market continues to grow, it is expected to have a positive impact on the overall health of the Canadian economy, and provide opportunities for investors and companies alike.
