There has been a delay of a couple of months, but on November third, Kakao Pay, the fintech unit of the country's most-popular chat app Kakao Talk, will go public. Ahead of its IPO on South Korea's benchmark KOSPI, it had a two-day book-building session which ended on Thursday, to take bids from institutional investors.
According to Kakao Pay on Friday, the IPO price was set at 90-thousand won or around 76 U.S. dollars per share the high end of its proposed price range as it was oversubscribed by a factor of about 17-hundred.
An expert says the market expectation for Kakao Pay is high.
The high expectation of the market towards Kakao Pay led to a high competition rate among institutions. Kakao Pay is deemed as the platform that can further expand into various services in finance, including simplified payments. Therefore there is a lot of interest from investors.
The two days of pre-orders for retail investors will take place from Monday to Tuesday next week.
Until last year, shares were generally only given to those who bid large amounts, and there was a much smaller chance for those with low deposits to get any shares at all. But starting this year, the allocation method has been revised so that a certain amount of shares allotted for individual investors is distributed with an equal chance, as long as they deposit the minimum amount.
But for the first time in South Korean IPO history, 100 percent of Kakao Pay shares allotted for retail investors will be distributed with an equal chance as long as they deposit the minimum amount.
The expert said competition among retail investors is expected to be high as well.
Shares alloted for Kakao Pay employees are fully subscribed. Along with high competition among institutions, competition among retail investors is expected to be fierce as well.
Also, on the first day of bidding for retail investors, the subscription will be open until 10 PM for people who subscribe online, from what used to close at 4PM, so that more people can join.
Eum Ji-young, Arirang News.