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Kakao Page's IPO expected to be delayed further

Kakao Page's logo, left, and a screen capture of the Kakao Page website / Courtesy of Kakao Page
Kakao Page's logo, left, and a screen capture of the Kakao Page website / Courtesy of Kakao Page

By Anna J. Park

The IPO timing of Kakao Page, an online content affiliate of mobile IT parent company Kakao, is expected to be delayed further to sometime around late 2021 or even pushed to 2022.

The entertainment company, which provides online cartoons, web novels, films and books, was expected to go public sometime this year, following Kakao Games' IPO in September, as mobile-based IT firm Kakao is currently preparing for IPOs of three of its affiliates ― Kakao Pay, Kakao Bank and Kakao Page ― sometime in the near future.

The two-pronged reason that the market was expecting Kakao Page to be Kakao's next IPO company was that it already selected NH Investment & Securities as its IPO underwriter early last year, and the company was one of the very first Kakao affiliates that achieved soaring annual net profits, with rosy future growth.

However, market watchers say the company's IPO seemed to be pushed aside again as Kakao Pay and Kakao Bank are in more urgent need to go public to secure capital for the sake of meeting a changed BIS capital ratio requirement that will begin to be applied in 2022.

Given an investment banking tradition that no more than two affiliates of a parent company go public in a year, the online company's IPO could be delayed to sometime around 2022. Another pressing reason for the delay is that other major IPOs scheduled for early next year, including LG Energy Solution ― a battery spinoff company from LG Chem ― and game company Krafton, as institutional investors have a limited focus on major IPO projects.

Regarding a local media outlet report that workers at NH Investment & Securities, the IPO underwriter company taking charge of the IPO process, were also ordered to stand by, an official from the securities company said he cannot give any details about the plan's schedule.

"As the underwriter company, we cannot confirm anything about Kakao Page's IPO plan as of now," an official from NH Investment & Securities told The Korea Times.

Kakao Page, meanwhile, said the company is looking for the best timing for the IPO, saying that it never announced a timeline.

"Kakao Page has never announced any timeline for our IPO plan," an official from the company said during a phone interview. "Market watchers and media just conjectured that the IPO would be completed within this year, but we never said so. Currently, the company is looking for the perfect timing for the IPO."

Analysts believe that the company has nothing to lose even if it decides to push its IPO plan much later, as the company is already seeing annual profits for five consecutive years since 2016, and its valuation will keep on growing.

"Kakao Page's revenue is expected to log around 500 billion won in 2020; the revenue from the Korean market is expected to record 30 percent year-on-year growth, which is about 30 percent of the total revenue," said Kim Dong-hee, an analyst at Meritz Securities Korea.


Kakao Page's logo, left, and a screen capture of the Kakao Page website / Courtesy of Kakao Page
Kakao Page's logo, left, and a screen capture of the Kakao Page website / Courtesy of Kakao Page

By Anna J. Park

The IPO timing of Kakao Page, an online content affiliate of mobile IT parent company Kakao, is expected to be delayed further to sometime around late 2021 or even pushed to 2022.

The entertainment company, which provides online cartoons, web novels, films and books, was expected to go public sometime this year, following Kakao Games' IPO in September, as mobile-based IT firm Kakao is currently preparing for IPOs of three of its affiliates ― Kakao Pay, Kakao Bank and Kakao Page ― sometime in the near future.

The two-pronged reason that the market was expecting Kakao Page to be Kakao's next IPO company was that it already selected NH Investment & Securities as its IPO underwriter early last year, and the company was one of the very first Kakao affiliates that achieved soaring annual net profits, with rosy future growth.

However, market watchers say the company's IPO seemed to be pushed aside again as Kakao Pay and Kakao Bank are in more urgent need to go public to secure capital for the sake of meeting a changed BIS capital ratio requirement that will begin to be applied in 2022.

Given an investment banking tradition that no more than two affiliates of a parent company go public in a year, the online company's IPO could be delayed to sometime around 2022. Another pressing reason for the delay is that other major IPOs scheduled for early next year, including LG Energy Solution ― a battery spinoff company from LG Chem ― and game company Krafton, as institutional investors have a limited focus on major IPO projects.

Regarding a local media outlet report that workers at NH Investment & Securities, the IPO underwriter company taking charge of the IPO process, were also ordered to stand by, an official from the securities company said he cannot give any details about the plan's schedule.

"As the underwriter company, we cannot confirm anything about Kakao Page's IPO plan as of now," an official from NH Investment & Securities told The Korea Times.

Kakao Page, meanwhile, said the company is looking for the best timing for the IPO, saying that it never announced a timeline.

"Kakao Page has never announced any timeline for our IPO plan," an official from the company said during a phone interview. "Market watchers and media just conjectured that the IPO would be completed within this year, but we never said so. Currently, the company is looking for the perfect timing for the IPO."

Analysts believe that the company has nothing to lose even if it decides to push its IPO plan much later, as the company is already seeing annual profits for five consecutive years since 2016, and its valuation will keep on growing.

"Kakao Page's revenue is expected to log around 500 billion won in 2020; the revenue from the Korean market is expected to record 30 percent year-on-year growth, which is about 30 percent of the total revenue," said Kim Dong-hee, an analyst at Meritz Securities Korea.


Park Ji-won annajpark@koreatimes.co.kr


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