The Era of Public Offering Stocks Ends... IPOs in H1 Plunge 48% Excluding LG Energy Solution

First Half IPO Hits 11.2 Trillion Won, 254% Increase
LG EnSol Only '10 Trillion Giant' in KOSPI Market
Decline in Paid-in Capital Increase and Corporate Bond Issuance... Rise in CP and Short-term Bond Issuance

[Asia Economy Reporter Ji Yeon-jin] The funds raised through initial public offerings (IPOs) in the first half of this year surged by more than 254% compared to last year. This was thanks to LG Energy Solution entering the KOSPI market with a valuation in the 10 trillion won range in January. Excluding this, the IPO market size was about 1.5 trillion won, roughly half of that from a year ago.

According to the "2022 First Half Corporate Direct Financing Performance" report released by the Financial Supervisory Service on the 28th, there were 48 IPOs in the first half of this year, raising 11.2546 trillion won. Among these, 1 was on KOSPI and 47 on KOSDAQ. This represents a 254.4% increase from last year's 49 IPOs raising 3.1756 trillion won, when the public offering craze was at its peak. Although there was only one KOSPI listing, LG Energy Solution's corporate value reached 10.2 trillion won, greatly surpassing the 47 KOSDAQ IPOs (1.0546 trillion won).

During this period, rights offerings amounted to 7.1641 trillion won (27 cases), down 24.3% from the previous year, and corporate bond issuance also decreased by 12.7% to a total of 96.1052 trillion won. Due to rising interest rates and weakened investor sentiment, conditions for corporate bond issuance deteriorated, with general corporate bonds issued at 227 cases worth 21.8025 trillion won, a 29.2% decrease from last year. Financial bonds (67.5358 trillion won) decreased by 6.1%, and asset-backed securities (ABS, 6.7669 trillion won) also declined by 8.7%.

As of the end of the first half of this year, the outstanding balance of corporate bonds increased by 4.1% year-on-year to 632.8082 trillion won, and general corporate bonds shifted to net redemption during the first half of this year.

On the other hand, during this period, commercial paper (CP) and short-term bond issuance totaled 841.9514 trillion won, up 10.9% compared to the same period last year. CP issuance increased by 9.6% to 199.2729 trillion won, while short-term bonds were issued at 642.6786 trillion won, up 11.3%.

As of the end of the first half of this year, the outstanding balance of CP was 229.4677 trillion won, an 8.2% increase from the end of June last year (211.9968 trillion won), and the outstanding balance of short-term bonds rose 44.5% to 80.9537 trillion won.

This content was produced with the assistance of AI translation services.