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| Seen above is a panoramic view of Korea's financial district on Yeouido in Seoul where the headquarters of many major local securities firms are situated. gettyimagesbank |
By Lee Min-hyung
KB Securities is seeking to regain its former glory in the local initial public offering (IPO) market after being named as a lead manager for HD Hyundai Global Service whose value is forecast to reach as high as 4 trillion won ($3.02 billion).
The KB affiliate was the top-ranked IPO lead manager in 2022, but its performance remained lukewarm in the first half of this year. According to data from the Korea Exchange, Korea Investment & Securities attracted the highest public subscription for the first eight months of this year. The figure amounted to 408 billion won.
NH Investment & Securities came in second with 280.5 billion won. Mirae Asset Securities and Samsung Securities followed.
However, KB Securities is gearing up to regain its luster in the market. The company is a manager for the IPO of a group of other mega-sized companies, including Doosan Robotics and LS Materials. Their combined value is forecast to reach more than 1.5 trillion won after the listing.
KB has recently attracted attention from the market after becoming a lead manager for the planned listing of the Hyundai affiliate. HD Hyundai is the largest shareholder of HD Hyundai Global Service, obtaining a 62-percent stake in the company. KKR is the second-largest shareholder. HD Hyundai plans to make the affiliate public sometime in the first half of 2024.
Given the firm's rapid earnings growth, its market value is widely forecast to rise higher by the end of this year. The company generated sales of 240.3 billion won in 2017, and the figure has since grown more than five times to 1.33 trillion won as of last year.
The much-anticipated IPO of LG CNS also paints a rosy outlook for KB Securities' rebound in the latter half. LG CNS named KB Securities, Bank of America and Morgan Stanley as lead managers for its IPO in May last year, but the plan has been delayed amid prolonged stock market doldrums. LG CNS is valued at around 4 to 5 trillion won here.
While there is no official confirmation regarding the LG subsidiary's IPO date, there remains a potential for it to be listed this year.
"Few mega-sized firms have gone public this year, so KB Securities and any other companies can rise to the higher rank, depending on their outcome in the latter half," an industry source said. "But they may not be able to do so due to the prolonged bearish sentiment in the stock market."
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