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THE INVESTOR
October 17, 2019
Big Reunion

Finance

Value of IPOs down 66% in 2018 amid lack of big tickets

  • PUBLISHED :February 13, 2019 - 14:49
  • UPDATED :February 13, 2019 - 14:49
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The number of initial public offerings on the Korean stock market rose, but their value declined more than 66 percent last year, according to data from the country’s financial watchdog on Feb. 13.
A total of 77 companies including 20 machinery makers and 17 bio companies got listed on the county’s two main bourses in 2018, increasing by 15 from the previous year, said the Financial Supervisory Service.

Most of the listings were on the secondary KOSDAQ. 



The listed firms raised 2.6 trillion won (US$2.30 trillion), the smallest amount in five years. It also compared with the 7.8 trillion won raised in 2017.

The value of IPOs declined after anticipated listings worth more than 1 trillion won, including those by firms such as Hyundai Oilbank and Kakao Games, were either delayed or canceled amid tepid stock market conditions.

In 2018, the largest IPO was issued by Aekyung Industry, which raised 198 billion won while 66 companies attracted less than 50 billion won each. In general, venture companies enjoyed the relaxed listing standards for non-profitable but promising tech companies. A record 21 firms got listed through the new standards launched in 2005.

Analysts predict a rebound in IPOs this year following a five-year decline.

“It is expected that companies that pushed back their IPOs last year will be back,” Choi Jong-Kyung, an analyst with BNK Securities said. “The value of IPOs will grow to 4.5 trillion won, as it is likely that there will be listings worth more than 1 trillion won.”

This year, analysts expect IPOs by prominent companies such as Kakao Games, E-Land Retail, Homeplus REITZ and Kyobo Life, which are expected to heat up the market.

However, Hyundai Oilbank has put its plans on hold indefinitely after selling a 19.9 percent stake to Saudi Arabia’s energy giant Aramco in January and premium massage chair brand Bodyfriend is likely to face a bumpy road for its listing as its management, including the CEO, faces allegations of not properly compensating employees.



By Park Ga-young (gypark@heraldcorp.com)

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