IPO Market Cooling? New Stocks Plunge 7%, 3 Forecasts for H2 Listings

Investor sentiment in the IPO market is rapidly freezing amid expanding stock market volatility. On the 21st, newly listed stocks, including Gido Industry, plunged by more than 7% in early trading amidst a weak KOSPI and KOSDAQ market, failing to escape the 'new stock jinx.' As the intense IPO subscription fever of the first half cools down, concerns about the outlook for the IPO market in the second half are growing.

Bitter Taste for New Stocks: Background of the IPO Market Cooling

The recent sluggishness of newly listed stocks is intertwined with overall macroeconomic uncertainty. As investor sentiment in the domestic stock market shrinks due to rising US Treasury yields and reignited inflation fears, a bomb of profit-taking sell-offs aimed at capitalizing on post-listing gains is pouring in. In particular, for small and medium-sized IPOs, the large volume of tradable shares on the first day of listing acts as a major cause for exacerbating the stock price drop.

• Shrinking Investor Sentiment: Institutional selling in the KOSDAQ and deepening supply-demand imbalances due to macro anxiety.
• Profit-Taking Sell-Offs: The exit of speculative funds seeking to lock in short-term profits early in the listing.
• Deepening Selective Screening: The bursting of bubbles for stocks that relied on expectations rather than corporate fundamentals.

Will the Debut of Mega-IPOs in the Second Half Be a Turning Point?

Experts predict that the IPO market in the second half will transition from the 'blind subscription' trend of the first half to a strictly 'selective investment' market. With 'mega-cap' companies boasting large market capitalizations lined up for listing, their demand forecasting results and initial stock price trends will be the watershed determining the direction of the entire IPO market.

FAQ: Key Questions Regarding IPO Investment

Q1. Is it risky to invest in newly listed stocks right now?

In the current high-volatility market, unreasonable chase buying immediately after listing should be avoided. Stocks with low institutional demand forecasting competition and low mandatory holding commitment ratios require particular caution.

Q2. What is the most important indicator to watch when subscribing to an IPO?

The proportion of tradable shares on the listing day and the institutional mandatory holding commitment (lock-up) ratio are the most important. The smaller the tradable volume, the stronger the upward momentum of the stock price in the early stages of listing.

Q3. What is the outlook for the IPO market in the second half?

While small and medium-sized stocks are expected to see increased volatility and stricter screening, there is a high possibility that market funds will concentrate again when blue-chip mega-companies backed by solid earnings and growth potential are listed.