Hyundai Oilbank's Third Attempt to Enter KOSPI

[Asia Economy Reporter Ji Yeon-jin] Hyundai Oilbank is planning an initial public offering (IPO) on the stock market.

According to the investment banking (IB) industry on the 18th, Hyundai Oilbank selected NH Investment & Securities, KB Securities, and Credit Suisse (CS) as lead underwriters yesterday afternoon. Mirae Asset Securities and Bank of America were named as joint underwriters. The estimated valuation is expected to reach between 8 trillion and 10 trillion won, and a separate underwriting group is also expected to be selected just before the listing.

This is the third time Hyundai Oilbank has pursued a listing. Although lead underwriters were selected twice in 2012 and 2017, the company did not enter the stock market. The listing process was halted in 2012 due to a decline in international oil prices and in 2017 due to a stake sale. In 2019, Hyundai Oilbank sold a 17% stake to Saudi Arabia's Aramco, securing 1.3749 trillion won in funds.

The market conditions are also favorable. The performance trend is improving, making it an advantageous time to assess corporate value. On a consolidated basis, the cumulative half-year sales reached 9.4805 trillion won, about 1.4 times higher than the same period last year. Operating profit turned positive to 678.4 billion won during the same period. Considering the operating and net losses recorded last year, this marks a successful turnaround.

Hyundai Oilbank's corporate value is projected to be between 8 trillion and 10 trillion won. When Aramco was attracted as an investor in 2019, the valuation was set at about 8 trillion won. The performance improvement compared to two years ago is clear, and oil prices and refining margins are also likely to rise. This is the optimal timing for the company to reach its targeted corporate value.

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