Korea’s IPO market comes to life again with big entrants in H2

2018.07.09 13:55:33 | 2018.07.09 13:58:49

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The pipeline for initial public offerings (IPOs) is packed with heavyweights for the remainder of the year after a thin first-half, raising hopes for much-needed boost to the lethargic Seoul bourse.

Major entrants for the main Kospi this year are Hyundai Oilbank, CJ CGV Vietnam, Lotte Data Communication and T’way Air. Kakao Games is readying to debut on the secondary Kosdaq. The five IPOs are estimated to value more than 3 trillion won ($2.7 billion).

Hyundai Oilbank, refining subsidiary of Hyundai Heavy Industries Group with nationwide gas station network, is estimated to be worth 10 trillion won. Its public offering scheduled for October would likely raise 2 trillion won. The company plans to file for a preliminary IPO review by August at the latest.

Lotte Data Communication, the information technology unit of conglomerate Lotte Group, will go public on the Kospi at the end of this month, making it the first IPO by a unit under Lotte Group since the conglomerate transformed into a holding company structure. Subscription will be open to the public on July 17-18.

The following entrant is the country’s third largest low-cost carrier T’way Air, which wants to gain an IPO momentum in time with summer business peaks. The IPO draws attention for the carrier’s fast growth and no ownership risk in comparison with rival Jin Air, the second-listed LCC unit of Korean Air. Its shares have been battered by the criminal investigations on power abuse of the owner family and the possibility of losing business license due to rule violation by the owner family.

In addition, South Korea’s largest multiplex cinema chain CJ CGV is aiming to list its Vietnamese entity on the Kospi in October. Details remain unknown, but industry sources forecast the IPO will be worth close to 150 billion won.

On the Kosdaq market, Kakao Games, the game developing unit of South Korea’s leading mobile messenger operator Kakao Corp., raises high interest, given enormous popularity of game stocks in Korea.

Kakao Games plans to submit a securities registration statement for an IPO next month.

By Cho Hee-young and Minu Kim

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