Kakao Pay's delayed IPO to be priced at lowered band of $51-77

Kakao Pay Corp., the fintech unit of South Korea’s platform giant Kakao Corp., this week prices its delayed and scaled-down initial public offering of around $1 billion amid fizzled-out market response to IPOs and platform stocks.

The simply pay platform on Wednesday embarked on a two-day bookbuilding session for 17 million at a desired pricing target range of 60,000 ($51) won to 90,000, which would fetch 1.53 trillion won ($1.3 billion) and place the market cap at 11.73 trillion won at the top end.

The stock bearing once-high-flying Kakao name may not debut in anticipated fanfare, given the latest icy response towards newcomers as well as negative sentiment and regulations on the omnipresent Kakao operators.

The company pushed back its IPO schedule twice amid toughened fintech regulations and overpricing controversy and shaved its IPO pricing band by 6.3 percent from original target.

Still many institutions find the IPO range still too pricy versus its modest net profit of 2.7 billion won in the first half.

Public subscriptions will take place on Oct. 25-26 and the new shares will debut on the main Kospi market on Nov.3.

Kakao Pay plans to apply uniform allotment for its entire IPO issue for the first time in the country’s IPO history to distribute the shares equally to all those who make the minimum subscription deposit to add appeal to retail investors.

Kakao Pay was launched in 2017 as a fintech spin-off from Kakao Corp. and has since expanded its business fast into insurance and securities. The company, 55 percent owned by Kakao and 45 percent by Ant Group’s Alipay Singapore Holding Pte Ltd., provides financial services including money transfers, savings accounts and asset management. It recorded a yearly transaction volume of 67 trillion won last year and 23 trillion won in the first three months of this year.

Shares of parent Kakao were 1.2 percent up at 129,000 won as of midday after going up to as high as 130.500 won.

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