Listing of BTS’ label may help ‘turn around’ South Korea’s lackluster IPO landscape

SINGAPORE — The highly anticipated market debut of Big Hit Entertainment, the music label behind South Korean K-pop megastars BTS, will shift South Korea’s public listing landscape away from traditional sectors, said Dealogic

“Big Hit’s IPO (initial public listing), it does bring some much needed diversity to the South Korean IPO landscape,” Romaine Jackson, head of Southeast Asia at Dealogic, told CNBC’s “Squawk Box Asia” on Tuesday.

“It’s traditionally been your technology names … your health-care names,” Jackson said. “To see some diversity coming to that sector mix, is very interesting … for the South Korean IPO market.”

On Monday, Big Hit Entertainment priced its stock at 135,000 South Korean won (approx. $115) per piece — the top end of the 105,000-135,000 won per share range earlier announced.

Jackson said the excitement surrounding the listing of the boy band’s management label has “brought a lot of fanfare and attention” to South Korea’s IPO market, which had been “asleep” so far this year.

According to Dealogic, listing volumes in South Korea were down “roughly 20%” before Big Hit priced, he said.

The upcoming IPO has “really helped to turn around” the trend seen in South Korean public listings, Jackson said. Prior to the deal, he added, South Korean listings were at a six-year low, despite the presence of significant liquidity in the market.

Beyond South Korea, the global IPO market is “extremely vibrant,” Jackson said, citing Dealogic figures.

“What we’re seeing is a really a hot, steaming IPO market,” he said. “Deals are also providing very strong returns and what we’re seeing … is a very strong and building pipeline.”

In September so far, Jackson said there have been more than $40.3 billion in global listings — “one of the largest months on record,” he said.

And Asia hasn’t been left out, with new listings in the region excluding Japan “up significantly” as well.

“Just last week, we saw $8.5 billion across Asia ex-Japan in new equity fundraising,” Jackson said, adding that the week before saw almost $7 billion dollars.

“Companies are definitely capital thirsty right now and they’re out there satisfying that thirst in the equity markets,” he said.