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More companies are seeking to go public on the first-tier Korea Exchange and the secondary KOSDAQ market amid the growing bullish sentiment.
According to the Korea Exchange, about 60 to 70 companies, most of which trade on the over-the-counter market, reportedly plan to make initial public offerings during the second half of the year.
The number of companies pushing for an IPO, as a prerequisite to be listed on the KRX or registered on the KOSDAQ, is estimated to reach 120 this year including those for the first half.
After 98 IPOs in 2010 and 76 in 2011, the number nosedived to 29 in 2012 in the wake of the prolonged bearish market, which was attributed to the sagging real estate sector due to the 2008-09 global financial crisis.
The IPO market, which is believed to have hit the bottom between 2012 and 2013 (40 issues), started to gain significant momentum last year thanks to the listing of Samsung Group’s two big over-the-counter stocks: Samsung SDS and Cheil Industries. As more than 30 companies including the two Samsung units sought to issue IPOs last December, the number of newcomers to the two main bourses rebounded to 78 in 2014.
Small investors are also actively trying to buy stocks in companies newly going public after seeing rallies of some newcomers, compared to their past stock value on the over-the-counter market.
KRX officials said the record-low benchmark interest rate, below 2 percent, are fanning the IPO market vitalization as more individuals have pulled out of their deposit from commercial banks and rush to risky assets.
Among the major IPO-seeking firms are Hyundai Motor Group-affiliated Innocean Worldwide, Aekyung Group-affiliated Jeju Air, Mirae Asset Life Insurance and Pulmuone Foods.
Others such as Lotte Data Communication, Yongpyong Resort and Celltrion Healthcare are also pushing forward the stock issuances.
Brokerage analysts attributed the IPO fever to the abundant liquidity in the market. According to the Korea Financial Investment Association, short-term floating funds in the market are currently estimated at over 900 trillion won ($830 billion), which compares with 600 trillion won two years ago.
In their attraction of investors in 2014, BGF Retail was 181 times oversubscribed, and Cuckoo Electronics, Korea’s best-selling domestic rice cooker manufacturer, was 175 times.
By Kim Yon-se (kys@heraldcorp.com)
According to the Korea Exchange, about 60 to 70 companies, most of which trade on the over-the-counter market, reportedly plan to make initial public offerings during the second half of the year.
The number of companies pushing for an IPO, as a prerequisite to be listed on the KRX or registered on the KOSDAQ, is estimated to reach 120 this year including those for the first half.
After 98 IPOs in 2010 and 76 in 2011, the number nosedived to 29 in 2012 in the wake of the prolonged bearish market, which was attributed to the sagging real estate sector due to the 2008-09 global financial crisis.
The IPO market, which is believed to have hit the bottom between 2012 and 2013 (40 issues), started to gain significant momentum last year thanks to the listing of Samsung Group’s two big over-the-counter stocks: Samsung SDS and Cheil Industries. As more than 30 companies including the two Samsung units sought to issue IPOs last December, the number of newcomers to the two main bourses rebounded to 78 in 2014.
Small investors are also actively trying to buy stocks in companies newly going public after seeing rallies of some newcomers, compared to their past stock value on the over-the-counter market.
KRX officials said the record-low benchmark interest rate, below 2 percent, are fanning the IPO market vitalization as more individuals have pulled out of their deposit from commercial banks and rush to risky assets.
Among the major IPO-seeking firms are Hyundai Motor Group-affiliated Innocean Worldwide, Aekyung Group-affiliated Jeju Air, Mirae Asset Life Insurance and Pulmuone Foods.
Others such as Lotte Data Communication, Yongpyong Resort and Celltrion Healthcare are also pushing forward the stock issuances.
Brokerage analysts attributed the IPO fever to the abundant liquidity in the market. According to the Korea Financial Investment Association, short-term floating funds in the market are currently estimated at over 900 trillion won ($830 billion), which compares with 600 trillion won two years ago.
In their attraction of investors in 2014, BGF Retail was 181 times oversubscribed, and Cuckoo Electronics, Korea’s best-selling domestic rice cooker manufacturer, was 175 times.
By Kim Yon-se (kys@heraldcorp.com)
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