K-pop boom drives South Korea’s entertainment listings to record high

South Korea’s music businesses are speeding to go public to capitalise on rising world demand for Ok-pop that has pushed leisure sector listings within the nation to a document excessive.

Funds raised by leisure listings in Seoul this 12 months have hit a document $3.8bn, Dealogic knowledge present, whereas shares within the nation’s main music businesses have hit all-time highs as artists resume reside concert events and different occasions.

The worldwide recognition of Ok-pop stars together with seven-member boy band BTS and lady group Blackpink has prompted smaller businesses to flock to the market.

RBW, the music label behind lady group Mamamoo, is anticipated to checklist on Monday, after elevating Won26.8bn ($22.5m) in its preliminary public providing. The IPO worth was set on the prime finish of the vary, with the providing oversubscribed greater than 3,700 occasions.

“The IPO success vindicates the significance of music IPs and our firm’s progress prospects,” RBW’s president Kim Jin-woo informed the Monetary Occasions. “We’ll proceed to make main killer content material for the worldwide market.”

RBW plans to make use of the IPO proceeds to speed up its world growth by buying extra music labels and IPs and signal on extra artists throughout Asia, mentioned Kim.

Column chart of Funds raised ($bn) showing South Korean entertainment IPOs bring in record funds in 2021

The corporate’s itemizing comes after Ok-pop fan communication platform operator DearU went public earlier in November. DearU, backed by each SM and JYP Leisure, raised Won85.8bn in its IPO, with the itemizing attracting enormous curiosity from each institutional and retail buyers.

International buyers from about 20 establishments together with Singapore sovereign wealth fund GIC, JPMorgan Chase, Constancy and Allianz attended DearU’s investor relations session for the IPO.

The eye for the small South Korean firm was uncommon, with most overseas buyers historically targeted on IPOs of huge Korean conglomerates. Greater than 100 firms have raised a mixed Won20tn by means of IPOs thus far this 12 months, in keeping with Korea Change.

“Traders are searching for a brand new goal on this sizzling sector as they’re eager to experience on the Korea wave,” mentioned Choi Joon-chul, chief government of VIP Analysis and Administration in Seoul. “DearU is the most effective instance of the business’s new enterprise mannequin, utilizing the Ok-pop fandom.”

DearU’s inventory worth has risen greater than 240 per cent from its IPO worth to Won89,400. The corporate runs a subscription-based messaging platform and has plans to launch a platform that might permit stars and followers to work together in digital actuality.

DearU at current operates a platform known as “DearU bubble”, by means of which Ok-pop followers can work together with their favorite stars utilizing messages, pictures and movies. The corporate mentioned the platform boasts 236 artists and greater than 800,000 subscribers.

Funding bankers count on extra Ok-pop-related firms to go public within the coming months following the success of Hybe, the label behind BTS, led by music IP buying and selling platform Music Cow, which is alleged to be making ready for an IPO as early as subsequent 12 months.

“Valuations are fairly excessive, reflecting their future progress potential. It stays to be seen whether or not they can reside as much as the excessive expectations,” mentioned Kim Joong-kon, head of fairness capital markets at NH Securities.


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