Investor sentiment frozen by the stock market crash
IPO giants find it difficult to be optimistic
Hyundai Engineering’s headquarters in Jung-gu, Seoul. Provided by Hyundai Engineering
Companies that were aiming to enter the stock market this year were all in trouble. The stock market atmosphere is extremely chaotic, with the share price of LG Energy Solutions (LG Ensol), which recorded a record-breaking success in the public offering process, plummeting for two days in a row after listing, and Hyundai Engineering, which was considered the ‘next big fish’, postponed its listing at all. because it wins
According to the Korea Exchange on the 1st, LG Ensol closed at 505,000 won, down 92,000 won (15.41%) from its opening price (597,000 won) on the 27th of last month, the first day of listing. Although the price is higher than the initial public offering price of 300,000 won, it failed to meet the initial expectations of investors. On the 28th of last month, the second day of the listing, the market closed at 450,000 won, down 10.89%, and received poor results compared to the market forecast before the IPO.
Hyundai Engineering, which had been expected as another ‘invitation word’, decided to withdraw from the IPO on the 28th of last month. This is because, in the demand forecasts for institutional investors conducted on the 25th and 26th of last month, the competition ratio was less than 100 to 1. This is significantly lower than LG Ensol’s competitive demand forecasting ratio (2,023 to 1).
If Hyundai Engineering continued the public offering, it was highly likely that the offering price would be set at 57,900 won, which is the lower end of the desired range. If this happens, the size of the public offering will be 926.4 billion won, which is significantly reduced from the upper level of 1.21 trillion won. Its market capitalization after listing is also 4.62 trillion won, which is 2 trillion won lower than the top (6.525 trillion won). For this reason, Hyundai Engineering judged that the company’s value was not properly evaluated.
The reasons for Hyundai Engineering’s low competition in demand forecasting include △ a relatively high proportion of old stock sales (75%) and △ aggravated investor sentiment due to the Gwangju apartment collapse. However, some analysts say that the overall investment sentiment has contracted due to the recent plunge in the domestic stock market, and the public offering market has withered.
Hyundai Oilbank and Kakao Enter are also not optimistic.
Given this situation, the concerns of companies looking to enter the stock market in the future are deepening. In particular, the mind of Hyundai Oilbank, which had already withdrawn from listing last year due to failure to predict demand, is bound to become complicated. Hyundai Oilbank is preparing for its third IPO with the goal of listing in the first half of this year. In December of last year, the IPO-related documents were submitted to the exchange and are undergoing preliminary examination.
The industry expects Hyundai Oilbank to enter the stock market smoothly in the first half of the year based on its favorable performance. This is because the business environment is favorable, including increasing demand for petroleum products due to the global economic recovery and rising international oil prices.
In fact, Hyundai Oilbank recorded a cumulative operating profit of KRW 851.6 billion in the third quarter of last year, turning to a profit this year from a loss of KRW 593.3 billion in the previous year. However, if the current crash continues throughout the first half of the year, the listing of Hyundai Oilbank cannot be guaranteed.
Kakao Pangyo Office. Provided by cacao
Kakao Group, which heated up the public offering market with Kakao Bank and Kakao Pay last year, is planning to list Kakao Entertainment in the second half of this year. Kakao Entertainment drew attention from investors early on, collecting topics by acquiring shares of famous celebrities such as Yoo Hee-yeol and Yoo Jae-suk. However, as the distrust of Kakao Pay’s management has grown over the controversy over ‘stock option scam’, investor sentiment has also froze, and the plan to apply for a preliminary examination for listing in the second quarter of this year may be disrupted.
In addition, △SSG.com △Market Kurly △Oasis Market also announced their listing this year. As Coupang succeeded in entering the US NASDAQ market last year, domestic retailers are also spurring their preparations for listing, but the market environment has changed 180 degrees from last year, so we cannot be optimistic.
Park Joo-hee reporter jxp938@hankookilbo.com
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