Retail investors in Russia are powering an IPO hot streak that's drawing vodka makers and pawnshops to go public

• Russia's stock market is seeing a streak of IPOs.
• The Moscow Exchange saw half a dozen firms go public this year, Bloomberg data shows.
• But experts say Russian stocks are putting up a facade of strength as its economy faces a grim future.

The Russian IPO market is seeing a streak of firms go public, with vodka makers to gold miners to pawnshop operators selling shares for the first time.

Bloomberg data shows around half a dozen Russian companies went public this year, collectively selling shares worth 12.4 billion rubles, or $130 million. It's a big jump in IPO activity compared to 2022, when just one Russian firm went public.

Most of the boom in the Russian stock market is being powered by retail traders, who have plowed cash into the Moscow Exchange. Retail investors now have eight times the amount of cash in the market than funds, Bloomberg data shows.

Meanwhile, Russian stocks have notched their highest level since the nation first began its "special military operation" in Ukraine last year. The MOEX Russian Index traded around 3,239 on Friday, up 49% from levels at the beginning of the year.

That's incentivized all types of firms to make their public market debut. Russian gold miner Yahuralzoloto has said it would IPO later this month, offering a 5% stake to investors. Kaluga Distiller Kristal, a Russian vodka maker, and Mosgorlambard, a pawnshop chain, have also said they were expecting to IPO in the near-future.

Five companies are planning to go public by the end of the year, assuming that market conditions hold up, according to the Russian news agency Interfax.

Western economists have cast doubt over the strength of Russia's stock market, given that foreign inflows and outflows within the Moscow Exchange are frozen. That means foreign investors aren't allowed to cash out their holdings, which is artificially propping up the market, according to two Yale researchers.

Meanwhile, the outlook for Russia's economy is grim as the nation continues to be slammed by western sanctions and the growing costs of its war with Ukraine. The nation could become de-industrialized or otherwise completely sapped or resources and manpower as it converts to a wartime economy.