Big Hit’s initial offering price set at 135,000 won

The initial offering price for Big Hit Entertainment, the Korean management agency for BTS, which will be floated on KOSPI on October 15, has been quoted at 135,000 won, the maximum amount of the agency’s expectation. The competition rate for institutional investors stands at 1,117.25 to 1. On October 5 and 6, a subscription for general investors will be offered.

The South Korean entertainment agency announced Monday that its initial offering price has been set at 135,000 won based on the expected demand of institutional investors. The offering is the highest on the price bandwidth of the company’s expectation, which was between 105,000 and 135,000 won.

Out of 1,420 participants of survey, 97.25% (1,381) were willing to pay more than 135,000 won, which means there could be an upward momentum of stock prices. But the share of mandatory retention by among institutional investors is 43.85%, much lower than those of SK Biopharmaceuticals (81.15%) or Kakao Games (58.59%). This means once there is an uptick of prices after IPO, profitable offerings from institutional investors could be available in bulk.

Subscriptions for general investors will be conducted for two days starting from October 5 on the platforms of NH Investment & Securities, Korea Investment & Securities, Mirae Asset Daewoo, and Kiwoom Securities. The competition rate for Kakao Games’ subscription was 1,524 to 1. In July, Ilooda, a local medial equipment developer, set a record at 3,039.56. It is noteworthy if the massive amount of investment funds in the pipeline will flow into Big Hit’s public subscription.


Dong-Hyuk Kim hack@donga.com