SMALL CAP MOVERS: AIM investors breathe a sigh of relief after Budget

The junior market breathed a sigh of relief this week after Labor Chancellor Rachel Reeves confirmed that an inheritance tax (IHT) exemption on AIM shares is here to stay.

Well, partly anyway. Reeves reduced the IHT exemption, which is currently worth 40 per cent, to 20 per cent.

There were fears in the run-up to her debut Budget that the exemption would be scrapped entirely, so the Chancellor’s softer approach was a sweet pill for the market to swallow.

The AIM All-Share index rose from 718 to 744 immediately after the Wednesday Budget announcement and closed the week 2 percent higher.

This is what analysts from real estate agency Panmure Liberum say. Galliford Try Holdings plc is likely to be a beneficiary of Reeves’ Big State Budget, which included a substantial £24.6 billion boost in capital investment.

Analysts highlighted that the government’s commitment to social housing development aligns with Galliford Try’s portfolio of public and regulated sector projects.

The government has also earmarked £6.6 billion for education investment by 2026, with £1.4 billion earmarked to rebuild more than 500 schools, which Panmure Liberum also expects Galliford Try to benefit.

Shares in Gaillford Try ended the week 6 per cent higher at 390p per share.

For green manure producer Atom plcit was far from the worst budget for the junior market.

Olivier Mussat, CEO of Atome, said: ‘Even with the reduction in the inheritance tax exemption, AIM will still provide a unique way for investors to back early stage UK companies such as Atome – the only UK listed producer of green fertilizers. .

“The recent speculation about tax changes has affected share prices, but now that the market has certainty, I expect we will see a recovery soon.”

The North Sea windfall tax increases announced in the budget failed to deter investors in North Sea oil exploration companies Jersey Oil and Gas plcwhose shares rose 38 percent this week.

Numerous other energy companies also posted nice profits, including United Oil & Gas plcwhich added 33 percent, and Orcadian Energy plcwhich added 30 percent.

In the field of alternatives: investor in hydrogen storage Energy Pathways plc rose by more than 20 percent, following Reeves’ announcement that the UK clean energy sector will benefit from £3.9 billion in funding by 2025-2026.

This briefly led to shares in the electrochemical specialist in the field of green hydrogen Ceres Power Holdings plc also in action. Ceres immediately surged 8 percent higher after the announcement, although a sharp retracement followed.

However, not all energy companies had a decent week.

Tlou Energy Ltd shares fell 45 percent after a quarterly activity report. The cash position of A$944,000 (£480,000) is likely to have spooked investors.

Tlou’s said its largest shareholder is willing to provide the company with a loan of up to A$5 million to support its gas production activities.

Mosman Oil & Gaswhich published its annual figures this week, fell by 23 percent. CEO Andy Carroll hailed a “big year” for Mosman as the company aims to start drilling its helium projects before the end of 2024.

Other energy drains included Empyrean Energy plcwhich fell 17 percent, and Europa Oil & Gas, which fell 12 percent.

AIM-listed provider of translation and localization services RWS Holdings fell 15 percent on Tuesday as it warned that sales would be flat over the next 12 months, marking two years of static sales.

RWS managed to achieve a recovery later in the week, but the shares could not escape the red zone on Friday.

In the technological field, shares in semiconductor wafer specialist IQE plc fell 20 percent after announcing that CEO Americo Lemos had left the company with immediate effect.

IQE has been trading lower in recent weeks after warning that trading performance will be worse than expected this year.

Touchstar plc also warned about profits. Shares of the mobile data solutions provider fell 12 percent after the company announced that 2024 revenue is likely to fall below previous expectations due to delayed orders and slower conversion times.

Finally, the AIM takedown of the week was brought to you by Eckoh plc. The board agreed to a takeover by private equity firm Bridgepoint for a total value of £169.3 million.

The AIM-listed payment solutions provider, which has been looking for a deal since last year, has been considering the offer since August.

After the announcement, shares rose 24 percent.