The initial public offering (IPO) market is freezing due to the recent crash of the South Korean stock market. As an increasing number of companies withdraw their listing plans due to concerns over a low level of subscriptions, firms preparing for listing are expected to feel nervous for a while.
Only six out of 15 companies newly listed on the secondary KOSDAQ market in the second half saw their closing prices on Aug. 8 remain higher than their offering prices, according to investment banking (IB) industry sources on Aug. 8. The performance of newly listed companies was not bad right after the listing, but they were hit hard as the stock market began to slump from the end of last month.
The price of i-Scream edu Co. shares closed 3.09 percent higher on Aug. 8 but it was half the offering price. Cowintech Co. which was listed on Aug. 5 when the KOSDAQ market plunged more than 7 percent recorded the lower limit on the first day of the listing.
Under the current circumstances, some companies gave up the listing. Carriesoft Co., a company that produces and provides kids' content, provided its blueprint to become “Asia’s Disney” on Aug. 6 but scrapped its IPO plans the very next day when demand forecasts turned out to be lower than expected.