Platform IPO candidates wary after SoCar's low subscription, IPOs at 30 vs last year's 112

[Source: SoCar]

Debutants on the Korean stock markets have stopped at 30 so far this year, compared with 112 last year on soured sentiment and liquidity from rapidly rising interest rates, and the remainder in the pipeline could have second thoughts upon the cold response to once-expectant SoCar, the country’s pioneering car-sharing platform.

SoCar’s public subscription, opened on Aug. 9-10, for its initial shares recorded a competition rate of 14.4:1. The response from institutional investors had been equally weak, forcing the company to price its IPO shares at 28,000 won ($21.39), even below the bottom end of indiciative range, 34,000 won, and scaling back offering volume by 20 percent.

SoCar has been floated as one of the biggest IPOs of the year. Its failure to draw a hot response from investors comes as a bigger disappointment in the country’s IPO market where other big candidates, like Hyundai Engineering, SK shieldus, and Hyundai Oilbank, had dropped their plans due to weak demand earlier this year.

Kurly, another IPO aspirant from the platform category and operator of the country’s leading online grocery Market Kurly, may have to adjust its IPO scheme if it wants to go through the offering.

[Source: Market Kurly]

Kurly is due to receive the result of its IPO preliminary review from stock market operator the Korea Exchange next week. Many expect the company to struggle setting its IPO share price as its enterprise value has more than halved to 2 trillion won now. It was valued at 4 trillion won in December last year when it attracted 250 billion won worth of pre-IPO investment from Anchor Equity Partners.

An official from Kurly, who asked to remain unnamed, said the company will determine its listing upon review result, adding that it was not considering withdrawing its IPO at this stage.

App-based lender K-Bank is planning to proceed with IPO as planned for this year. It attracted 1.25 trillion won through rights offering last year with a promise to go public.

The company is currently waiting for the stock market operator’s approval on its preliminary IPO application.

So far in the year, only 30 firms went public – 3 on the Kospi and 27 on the Kosdaq – shriveling from last year’s 112 - 23 on the Kospi and 89 on the Kosdaq. Twenty-two others have passed the review, but whether they will push through IPO this year is uncertain. At current count, stock debutants would likely be the smallest since 2013.

[ⓒ Maeil Business Newspaper & mk.co.kr, All rights reserved]