Investors who entered the market for newly listed stocks this year are likely facing significant losses. Many stocks that surged as much as 300% on their debut have since plummeted. All 33 newly listed stocks have fallen below their closing prices on the first day of trading, with an average decline exceeding 60%. More than 90% of these stocks are currently trading below their initial offering prices.
According to the Korea Exchange on October 13, all 33 stocks that went public this year through general offerings (excluding SPACs) have seen their prices drop below their first-day closing prices. The average return compared to the first-day closing price is -60.54%. If investors had purchased shares at the first-day closing price and held onto them, they would have incurred losses across all examined stocks.
The situation is similar when looking at the initial offering prices. Of the 33 stocks, 31 (93.9%) are trading below their offering prices. The average return compared to the offering price is -36.63%, indicating that most investors who received shares through the public offering are also experiencing losses.
The price trends from the first day of trading to now are starkly contrasting. On their debut, these stocks had an average return of 101.47% compared to their offering prices, with 25 stocks trading above their offering prices. Currently, only two stocks, MakinaRax and SkyLabs, remain above their offering prices.
Notably, among the nine stocks that rose over 200% on their first day, eight have since fallen below their offering prices. WisePlanet Company, which debuted on September 23 with an offering price of 12,000 won, closed its first day at 46,300 won, a 285.83% increase. However, its current price has dropped to 9,930 won, reflecting a 78.55% decline from the first-day closing price and a 17.25% drop from the offering price.
The decline for ESTEM has been even steeper. Initially priced at 8,500 won, ESTEM closed its first day at 34,000 won, achieving a so-called 'double.' However, its current price has plummeted to 2,825 won, marking a 91.69% drop from the first-day closing price, the largest among the examined stocks.
Similarly, Polled ended its first day at 20,000 won, four times its offering price of 5,000 won, but has since fallen to 2,505 won, an 87.48% decrease. IM Biologics also saw its price drop from a first-day high of 104,000 won to 15,680 won, a decline of 84.92%. Other stocks, including Hanpass (-84.17%), Kanaph Therapeutics (-79.82%), Chaebi (-79.78%), and Axvis (-79.26%), have also recorded significant declines from their first-day closing prices.
Currently, only MakinaRax and SkyLabs are trading above their offering prices, with MakinaRax at 19,140 won, a 27.60% increase from its offering price of 15,000 won, and SkyLabs at 12,470 won, a 24.70% rise from its offering price of 10,000 won. However, both stocks have also fallen significantly from their first-day closing prices, down 68.10% and 46.94%, respectively.
A financial industry expert cautioned, "Investing based solely on high initial returns can lead to losses. Investors in IPOs should carefully consider a company's performance, growth potential, and fair valuation rather than being swayed by initial price movements."
* This article has been translated by AI.
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