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Hyun Shin-kyun, president of LG CNS, who is giving a presentation. (Photo=Yonhap news) |
[Alpha Biz= Kim Jisun] According to the Korea Exchange on Wednesday, LG CNS closed at 55,800 KRW, down 6,100 KRW (9.9%) from its initial public offering (IPO) price of 61,900 KRW.
Even before the regular trading session began, the stock was already in the 50,000 KRW range during the pre-market matching phase and dropped as low as 54,900 KRW during intraday trading. Investors who participated in the IPO subscription faced capital losses even if they sold at the day's peak price of 60,700 KRW.
LG CNS, which attracted massive anticipation with 21 trillion KRW in retail subscription deposits, showed sluggish stock performance on its debut trading day, likely intensifying dissatisfaction among LG Group investors. Concerns over duplicate listings had already fueled criticism regarding LG CNS’s IPO. Currently, 49.95% of LG CNS shares are owned by LG Corp.
According to an analysis by the Korea Corporate Governance Forum, key LG subsidiaries such as LG Electronics, LG Chem, LG Household & Health Care, and LG Uplus are all already publicly traded. Before this IPO, LG CNS was LG Corp’s only major unlisted subsidiary.
In response, LG Corp, the holding company of LG Group, has announced plans to repurchase and retire 500 billion KRW worth of treasury shares by 2026 and increase its dividend payout ratio from 50% to 60% of net profit. However, LG Corp’s stock price, which traded as high as 78,100 KRW last November, was recorded at 72,100 KRW on this day.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
