[Special Stock] KakaoPay Hits New Lows for Two Consecutive Days Amid 76 Million Locked-In Shares

[Asia Economy Reporter Lee Seon-ae] Kakao Pay has been showing weakness for the second consecutive day following the previous day. It is interpreted that investor sentiment has weakened as about 76 million shares of 6-month lock-up shares have been released.

As of 10:35 a.m. on the 3rd, Kakao Pay is trading at 107,000 KRW, down 0.93% from the previous day. In the early session, it fell to 106,000 KRW, marking a new 52-week low for two consecutive days following the previous day (107,500 KRW).

The decline in Kakao Pay's stock price is presumed to be due to the release of lock-up shares. Previously, on February 3rd, when 3-month lock-up shares (2.22 million shares) were released, Kakao Pay's stock price plunged by up to 7% during the session.

According to the Korea Securities Depository, on this day, the lock-up shares held by the largest shareholder Kakao (76.25 million shares, 57.55% of issued shares) will be released. On the same day, the lock-up shares held by the second largest shareholder Alipay (13.89 million shares, 10.49%) and the shares locked up by institutional investors at the time of listing (1.7 million shares, 1.28%) will also be released. Kakao committed to a total one-year lock-up period by adding a voluntary 6-month lock-up period to the legally required 6-month lock-up period for the 62.35 million shares it holds.

Meanwhile, the earnings are also sluggish. Kakao Pay recorded a loss in the first quarter (January to March) of this year. On a consolidated basis, sales in the first quarter were 123.3 billion KRW, a 15.1% increase from 107.1 billion KRW in the previous year. However, it recorded an operating loss of 1.1 billion KRW, turning to a deficit compared to an operating profit of 10.8 billion KRW in the same period last year. Net profit was 3.8 billion KRW, down 68.4% from about 12 billion KRW in the previous year.