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Investors in public firms lose 550 bil. won

Posted August. 20, 2000 20:50,   


Following the severe plunge in share prices for Korea Tobacco & Ginseng Corp. (KTGC) and Korea Gas Corp. (KOGAS) since they were first listed last year, individuals who invested in stocks through public offerings have incurred huge losses.

KTGC stock as of Friday stood at 20,050 won, a drop of 28.4% from its IPO price of 28,000 won, while KOGAS plummeted 32.0% to 22,450 won from its starting price of 33,000 won.

In the case of KTGC, with the public offering stock volume standing at 28.65 million shares, individual investors have lost more than 227.8 billion won. KOGAS investors have lost around 327.1 billion won when the 31 million shares subscribed during the public offering are taken into account.

On the other hand, the government earned capital gains of 659 billion won from KTGC and 168 billion won from KOGAS through the sale of existing shares, a total profit of 827 billion won.

Experts in the securities industry forecast that the additional privatization of public enterprises such as Korea Heavy Industries will be fraught with difficulty, as the share prices of listed public companies are struggling despite improved business performance.