Growth stocks are particularly in favour right now, with their share prices rising. While technology stocks have played a big part in fuelling that exuberance, there is a clear appetite for higher-risk stocks in other sectors.

But the mantle of high-growth stock carries a greater level of risk because it only delivers if the growth strategy sold to investors pays off. So, the execution risk is real and, lately, some that have pored over GYG’s prospectus have raised red flags around some accounting treatments, and the contribution to profits derived from interest earned on the cash the company will receive from the float.

Others have simply declared the restaurant chain is overvalued.

On the plus side, the current investors are retaining sizable stakes in the company, which should provide some comfort. Moreover, a few of the new investors are existing players in the fast food market – a useful testimonial that should calm some fears.

But perhaps the most important element of GYG’s debut on the ASX will be the litmus test it will provide to investors and other companies that are on the sidelines assessing whether now is the right time to hit the IPO market.

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With a market capitalisation of $2.2 billion, GYG is the biggest new listing since 2021, and it’s coming at a time when interest rates and inflation remain high. It’s not a positive environment for equity markets, and no corporate entrant wants to see their shares slide or stall.

Blair Beaton, the ASX’s group executive of listings, believes the pipeline of IPO’s is set to improve in the second half of this calendar year.

And even if inflation continues to be a bit stickier than central banks had anticipated, most forecast that inflation will trend down over the next year and interest rates will start to fall in the medium term.

For investors, they are hoping the latest assessment of the global economy delivers a modicum of stability to equity markets. GYG’s market debut will be a big test of that sentiment, so set your alarm for noon Thursday for our own Mexican wave.

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