Kakao Games IPO Subscription D-1... Securities Firms' CMA Balance Surpasses 60 Trillion Won for the First Time

As of the 27th, Securities Firms' CMA Balance at 60.4 Trillion Won... 4.3 Trillion Won Increase in One Month
Expectations for SK Biopharm Subscription Frenzy Revival

[Asia Economy Reporter Minwoo Lee] The balance of securities firms' Comprehensive Asset Management Accounts (CMA) has surpassed 60 trillion won for the first time ever. It is expected that funds have poured in ahead of Kakao Games' public offering subscription. Attention is focused on whether the public offering subscription frenzy seen during SK Biopharm's listing in the first half of the year will be repeated.

According to the Korea Financial Investment Association on the 31st, as of the 27th, the balance of securities firms' CMA was recorded at 60.4098 trillion won. This is an increase of about 4.3 trillion won in one month compared to 56.077 trillion won on the 31st of last month. This is the first time the CMA balance has exceeded 60 trillion won.

There are forecasts that a public offering subscription frenzy similar to that of SK Biopharm in June will appear once again. On June 22, one day before SK Biopharm's general subscription, the securities firms' CMA balance was recorded at 57.5246 trillion won. This was a sharp increase of about 4 trillion won compared to 53.5854 trillion won on June 15, a week earlier. Afterward, the subscription balance sharply dropped to 46.8517 trillion won on June 24.

Kakao Games will announce the final public offering price today based on the results of the demand forecast and will conduct a subscription for general investors on July 1-2. It will then be listed on the KOSDAQ market on the 10th. The lead underwriters are Korea Investment & Securities and Samsung Securities. It is already known that the demand forecast for institutional investors conducted on June 26-27 surpassed a competition rate of 1000 to 1. This far exceeded SK Biopharm's demand forecast competition rate of 836 to 1, which sparked the subscription frenzy in June. This year, only Iruda, Korea Pharma, and TSI have recorded demand forecast competition rates above 1000 to 1. However, their public offering amounts were limited to around 13.5 to 18.5 billion won. Kakao Games' expected public offering amount based on the desired price is projected to reach up to 384 billion won. It is considered unusual for a large-cap stock with a public offering amount exceeding 300 billion won to record a demand forecast competition rate of 1000 to 1.

Interest is focused on whether an unprecedented amount of pooled funds will flow into Kakao Games amid this enthusiasm. SK Biopharm set a record with general investor subscription deposits of 30.99 trillion won. Given that companies slightly smaller than Kakao Games, such as Lemon (2.3618 trillion won) and A-Pro (4.6759 trillion won), also attracted several trillion won, it is forecasted that more than 10 trillion won is quite possible.

In particular, since Kakao Games' desired public offering price is between 20,000 and 24,000 won, which is lower than the over 63,000 won price of its over-the-counter stock, expectations are growing that the SK Biopharm fever will be reproduced. At that time, SK Biopharm's public offering price was 45,000 won. On the first day of listing, it recorded the KOSPI's first-ever 'ttasang' (opening price formed at double the public offering price followed by the upper price limit), soaring to 127,000 won. It then continued to hit the upper price limit for two consecutive days, surpassing 200,000 won.

Most stocks listed afterward significantly exceeded their public offering prices on the first day of listing. Excluding real estate investment trusts (REITs) and special purpose acquisition companies (SPACs), 12 out of 15 stocks listed after SK Biopharm closed above their public offering price on the first day. A-Pro (159.7%) and Withus Pharmaceutical (116.4%) more than doubled their public offering prices. Iruda (96.1%) and Korea Pharma (87.2%) also rose close to 100% compared to their public offering prices.