Enterprise Value Estimated at KRW10tr
The Korea Exchange's Securities Market Headquarters said on Sept. 30 that it has received Hyundai Engineering's application for a preliminary review on listing eligibility.
Established in January 2001, Hyundai Engineering provides technical services related to construction and plant engineering. The company is a subsidiary of Hyundai Engineering & Construction (Hyundai E&C). Hyundai E&C holds a 38.62 percent stake in the company as of the first half of 2021.
Hyundai Motor Group chairman Chung Eui-sun holds an 11.72 percent stake in Hyundai Engineering. Chung is likely to sell off his stake when the company is listed. Hyundai Engineering's listing could be the beginning of Hyundai Motor Group’s efforts to change its governance structure.
In 2020, Hyundai Engineering racked up 6,434.7 billion won in sales. Its operating profit stood at 293.9 billion won and net profit 203.6 billion won. Its total assets amounted to 5,672.9 billion won and its equity capital 3,517.3 billion won.
Experts in the financial investment industry estimate Hyundai Engineering's corporate value at up to 10 trillion won. As a result, the size of subscriptions to the company’s public offering is expected to reach trillions of won. "We believe that Hyundai Engineering's corporate value of 10 trillion won is not an excessive overvaluation," said Kim Se-ryeon, a researcher at eBEST Investment & Securities.
If Hyundai Engineering passes the screening without a delay, it is expected to receive approval for listing around mid-November and start a full-fledged IPO process in December. The expected listing time is the first quarter of 2022.