In this photo provided by SOCAR Inc., the car-sharing giant’s CEO Park Jae-wook speaks to the press about the firm’s IPO plan in Seoul on Aug. 3, 2022.
SEOUL, Aug. 3 (Korea Bizwire) — South Korea’s largest car-sharing and mobility service provider SOCAR Inc. on Wednesday said that its planned initial public offering (IPO) will be successful despite unfavorable market conditions.
SOCAR, established in 2011, is seeking to make a market debut later this month after going through IPO subscription Thursday and Friday this week from institutional investors and Wednesday and Thursday next week from retail investors.
It wants the IPO price to be set at between 34,000 won (US$25.60) and 45,000 won, which will help the car-sharing service provider raise up to 205 billion won.
Its market cap after the IPO will range from 1.2 trillion won to 1.6 trillion won.
SOCAR said its stellar performance in the car-sharing market will help make its IPO successful although the local IPO market has been chilly in the face of monetary tightening and a looming economic recession.
“We are confident about SOCAR’s performance this year and next year, both in expansion and profitability,” SOCAR CEO Park Jae-wook said in a press meeting.
“We are not sure exactly how long this upward momentum (in the car-sharing service market) will last, but we cannot miss this opportune moment. It is better to seek ways to fly high with the raised funds,” he added.
Park said SOCAR’s earnings will be able to shift to the black, backed by its 79 percent market share and brand awareness that will reduce its marketing costs.
Thanks to the flourishing single-person households, people are becoming increasingly open to car-sharing, Park said.
This file photo provided by SOCAR shows a self-driving car being operated on Jeju Island.
According to SOCAR data, 64 percent of its clients are returning customers, and more than 50 percent of its users wish to keep using their SOCAR plans or delay purchases for new cars.
It holds some 19,000 cars for its service across the country. Its sales spiked 31 percent on-year to 289 billion won last year, but it suffered an operating loss of 21 billion won.
SOCAR plans to spend the proceeds from the IPO to raise its presence in the mobility market with investment in technology and the acquisition of promising mobility firms.
Within this year, the company plans to launch a “super app” that combines the existing car-sharing services with “micro mobility,” such as electric bicycles, and platform-based parking services.
Also in the second half of this year, it will test-provide a large-scale vehicle management solution to leading logistics giants, such as Hyundai Glovis Co. and Lotte Global Logistics Co.
Last year, it bought a 100 percent stake of Nine2one Inc., operator of e-bike sharing service Elecle, and acquired online parking platform service Modu Co. via a share swap.
(Yonhap)
