171 Million Applicants for Hyundai Heavy Industries IPO Subscription... 56 Trillion Won in Deposit, 406 to 1 Competition Ratio

by Park Soyeon

Published 08 Sep.2021 21:21(KST)

Updated 08 Sep.2021 21:22(KST)

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[Asia Economy Reporter Park So-yeon] Hyundai Heavy Industries gathered subscription deposits worth 56 trillion won in its general public offering. The number of subscribers exceeded 1.7 million.

According to the lead underwriter Mirae Asset Securities on the 8th, the total subscription deposits received by eight securities firms amounted to a provisional total of 56.0562 trillion won as of the closing of Hyundai Heavy Industries' subscription.

This is considered the largest scale since the KakaoBank public offering subscription deposits of 58.302 trillion won conducted in July.

On the first day of subscription, 5.5751 trillion won was gathered, and on the second day, 50.4811 trillion won was collected. Since duplicate subscriptions were prohibited, it appears that many investors subscribed at the last minute after checking the competition rates by securities firms.

The subscription deposits by securities firms were: Mirae Asset Securities 18.0996 trillion won, Korea Investment & Securities 17.8095 trillion won, Hana Financial Investment 7.4039 trillion won, KB Securities 7.0786 trillion won, Samsung Securities 2.4582 trillion won, DB Financial Investment 1.1095 trillion won, Shin Young Securities 1.0692 trillion won, and Daishin Securities 1.0278 trillion won.

The integrated competition rate was 405.50 to 1. With 4,608,003 shares offered, the subscription quantity was 1,868,538,420 shares.

The competition rates by securities firms were highest at Hana Financial Investment with 416.81 to 1, followed by DB Financial Investment at 416.39 to 1, Mirae Asset Securities at 409.02 to 1, Korea Investment & Securities at 402.46 to 1, Shin Young Securities at 401.27 to 1, KB Securities at 398.50 to 1, Samsung Securities at 395.39 to 1, and Daishin Securities at 385.74 to 1.

The total number of subscription cases across the eight firms was 1,711,910. Korea Investment & Securities had 509,532 cases, Mirae Asset 508,860 cases, KB 284,969 cases, Hana 179,988 cases, Samsung 135,076 cases, Daishin 43,496 cases, DB 28,262 cases, and Shin Young 23,727 cases.

The equal allocation method, which distributes half of the offered shares equally to all subscribers, was applied in this subscription as well.

Among the eight firms, except Samsung Securities, the other seven did not exceed the number of subscription cases relative to the equal allocation volume, so all subscribers who deposited at least 300,000 won for the minimum subscription unit of 10 shares secured at least one share.

The expected equal allocation shares, calculated by dividing the equal allocation volume by the number of subscription cases for each securities firm, ranged from about 1.0 to 1.9 shares for the seven firms. Each subscriber received one share first, and the remaining shares were distributed by lottery.

However, Samsung Securities had 135,076 subscription cases exceeding the equal allocation volume of 103,618 shares, so some subscribers may not receive even one share from the equal allocation depending on the lottery results.

Considering the competition rate, the proportional allocation shares are expected to be given to subscribers who deposited about 23 to 24 million won. A deposit of 100 million won would receive about four shares.

Therefore, an investor who deposited 100 million won is expected to receive about five shares in total, combining equal and proportional allocation shares.

Regarding this subscription result, Mirae Asset Securities explained that if there are investors who subscribed multiple times across several securities firms, they will exclude those cases and finalize the competition rate and subscription cases tomorrow for public disclosure.

Earlier, Hyundai Heavy Industries confirmed the public offering price at the upper end of the desired range, 60,000 won, based on institutional investor demand forecasting. The public offering amount based on the offering price is 1.08 trillion won, and the market capitalization after listing is 5.3264 trillion won.