Wrapup 1: Tokyo tech IPO soars but Seoul deal tanks 10% in volatile Asian markets

LG CNS Co

05/02/2025 08:10

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      LG CNS shares dive 10%
    

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      Tokyo's Next Generation Technology shares jump 58%
    

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      Markets roiled by trade war tensions
    

  
    By Scott Murdoch and Joyce Lee
       SYDNEY/SEOUL, Feb 5 (Reuters) - Shares of a small
Japanese technology firm shot up nearly 60% on its first day of
trade on Wednesday, while Seoul's largest initial public
offering (IPO) in three years tanked almost 10% as volatility
driven by geopolitics again gripped Asia's equity markets.
    South Korea's LG CNS  064400.KS  shares dropped from opening
bell and traded in negative territory for the session, failing
to arrest the recent trend of weak debuts for the Seoul market. 
    The IT, cloud and AI services provider's shares closed at
55,800 won, down from their issue price of 61,900 won.
    Shares of Next Generation Technology - the first IPO debut
of 2025 in Tokyo - traded 58% higher before paring some gains
across the day. It raised 1.3 billion yen in the IPO ($8.49
million), according to its regulatory filings.
    The strong first day performance came as Tokyo's Nikkei
 .N225  nudged up 0.1% on Wednesday, In Seoul, the Kospi  .KS11 
gained 1.1%.
    MSCI's broadest index of Asia-Pacific shares outside Japan
 .MIAPJ0000PUS  was 0.44% higher later Wednesday as China's main
equities indices traded lower.
    The prospect of a trade war between the U.S and China as
tit-for-tat tariffs between the world's top two economies has
raised investor concerns about financial market volatility over
the near term.
    Asian deal makers were hopeful the region's equity capital
markets would perform better in 2025 as global interest rates
began to fall and more Chinese IPOs were given regulatory sign
off. 
    LNG CNS last month priced its IPO at the top of its targeted
valuation range, raising 1.2 trillion won ($827.1 million). 
    At closing, the firm's market valuation was about 5.4
trillion won.
    The IPO is the largest since LG Energy Solution  373220.KS 
raised $10.74 billion in 2022. 
    Last year, South Korea raised $2.85 billion worth of IPOs,
according to LSEG data, up slightly from $2.79 billion in 2023.
    LG CNS' offering was one of the few by South Korean firms to
draw strong demand in recent months against the backdrop of an
IPO market slump since the second half of last year, analysts
said. 
    The retail portion of the initial public offering was
oversubscribed nearly 123 times, while more than 2,000
institutional investors made bids worth 76 trillion won during
the bookbuilding last month, according to the company. 
    However, LG CNS's weak market debut has continued a trend of
similarly disappointing listings since last year, which analysts
said could further discourage investors and other companies from
coming to market. 
    

($1 = 1,450.8900 won

($1 = 153.1300 yen)

 (Reporting by Joyce Lee and Scott Murdoch; additional reporting
Nobuhiro Kubo. Editing by Jacqueline Wong & Shri Navaratnam)
 ((joyce.lee@tr.com;))