Portions of Big Hit Entertainment, the music name of K-pop geniuses BTS, took off as they made their market debut in South Korea on Thursday.
Success Entertainment’s stock opened at 270,000 Korean won (approx. $236) per share on Thursday, as per Refinitiv Eikon. That was twofold the stock’s issue cost of 135,000 Korean won for every offer. Offers expanded increases after the open before debilitating. It completed its first exchanging day over 90% higher than its issue cost.
South Korea’s diversion area is “turning out to be worldwide scale,” Daniel Yoo, head of worldwide speculation at Yuanta Securities Korea, told on Thursday.
If you look at the overall IPO market, it’s really, really hot.– Daniel Yoo YUANTA SECURITIES KOREA
“We think that the entertainment industry will be very important industry for Korea for investor(s) to invest,” Yoo said.
All things considered, the examiner conceded that Big Hit Entertainment’s present valuation “may be excessively costly” as its current reliance on the South Korean seven-part boyband BTS is “extremely high.”
South Korea’s ‘hot’ IPO market
Success Entertainment’s market debut returned on the of other blockbuster IPOs, for example, SK Biopharmaceuticals and Kakao Games that likewise observed large hops on their first day of exchanging.
“In the event that you take a gander at the general IPO market, it’s super hot,” Yoo said. Most financial specialists in past open postings, for example, SK Biopharmaceuticals “made anyplace between 100-200% profits for the presubscription in the event that they can get the stocks,” he included.
Some portion of this was expected to the “colossal liquidity” being seen in the South Korean business sectors, he said.
The Bank of Korea as of now has its base rate at a noteworthy low when significant national banks all around the world have cut loan fees in an offer to help monetary business sectors during the Covid pandemic.