On Tuesday and Wednesday, Kakao Games drew nearly 50 billion U.S. dollars in retail orders for its IPO, the most of any South Korean company to date.
The offering was oversubscribed among retail investors by a multiple of about 1,5-hundred-25 which is more than four times the previous record set by SK Biopharmaceuticals.
"The reason there was so much competition is because shares of Kakao Games were traded over the counter at more than three times the IPO price of 24-thousand won."
Normally, to reserve shares, a retail investor only has to deposit half the amount of the shares they want to buy at the IPO price, which for Kakao Games was 24-thousand won, or about 20 U.S. dollars.
But because it was oversubscribed by a factor of more than 15-hundred, to reserve a single share required a deposit of 24 million* won, or 20-thousand dollars.
That amount is far out of reach for small investors, so the Financial Services Commission is considering a reform of the IPO subscription system so the small investor can have a chance.
Of those who were able to reserve shares in Kakao Games, their age skewed higher.
According to Samsung Securities, which supplied 40 percent of the shares for retail investors, the biggest group of investors were in their 40s, followed by those in their 50s and then 30s.
They also tended to buy in big.
Those in their 70s bid the highest amount by average of 300-thousand dollars per person.
The Kakao Games IPO has set high expectations for other upcoming offerings, including Big Hit Entertainment, the company behind BTS, which plans to raise about 810 million dollars in its IPO.
Eum Ji-young Arirang News.