New technology drives South Korea’s IPO boom

More than 20 companies went public in South Korea’s main market last year, raising about $14 billion, nearly double the previous record set in 2010.

Last year was a banner year for IPOs around the world, and South Korea was no exception. And 2022 is shaping up to be another bumper year for Asia’s fourth-largest economy.

More than 20 companies went public in South Korea’s main market last year, raising about $14 billion, nearly double the previous record set in 2010. Among the biggest are the IPO of 3 $.8 in August from video game producer Krafton, the $2.1 billion raised by KakaoBank in July and the $1.3 offering in March from biopharmaceutical company SK Bioscience, which was one of the IPOs best performing stock exchanges in the world for the year.

The market got off to a flying start this year, with the $10.8 billion offering in mid-January from LG Energy Solutions, the world’s second-largest maker of batteries for electric vehicles. The company will use the funds in part to increase battery production capacity by 2.6 times over the next three years as it expands into six countries. LGES’ offering was more than double the size of the previous largest transaction on the Korean exchange, Samsung Life Insurance in 2010.

Near press time, construction company Hyundai Engineering was aiming to raise about $1 billion in an IPO in late January. Later in the quarter, Hyundai Oilbank, the refining unit of Hyundai Heavy Industries Group, will make its third attempt to go public. South Korean retail giant Shinsegae Group’s online store segment and online grocery delivery platform Market Kurly are among other issuers aiming to go public in the coming months.

Increased interest from retail investors, in part thanks to a new system that improves the chances that retail investors will have access to offerings, has been a major driver of Korea’s IPO market. More than 20 million people, nearly 40 percent of South Korea’s total population, participated in the IPO market last year, more than 11 times the previous year’s total. Additionally, the Korean stock market benefited from investors seeking to increase their allocation to Asian markets outside of China, following Beijing’s regulatory crackdown.

About Emilie Brandow

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