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Celltrion Healthcare cruises in Kosdaq debut

Shares of Celltrion Healthcare rose over 15 percent on the first day of its initial public offering on the second-tier Kosdaq market Friday.

Stocks of the sole marketer and supplier of biopharmaceutical firm Celltrion closed at 50,300 won ($44.90), up 22.68 percent from the offering price of 41,000 won.

Celltrion Healthcare has been bullish throughout the day since it opened at 6.5 percent higher. This came in contrast to the weak Kosdaq market and its bellwether Celltrion, which shed 2.03 percent and 2.5 percent, respectively.

On the Kosdaq market, Celltrion Healthcare, with a market cap of some 6.9 trillion won, was just behind Celltrion, the maker of the Remicade-referencing Remsima and Rituxan-referencing Truxima, with 13.3 trillion won in market cap.

Celltrion President Kim Hyeong-gi (second from left), Celltrion founder Seo Jung-jin (center), Celltrion Healthcare Chief Executive Officer Kim Man-hoon (third from right) and officials from market operator Korea Exchange celebrate the initial public offering of Celltrion Healthcare on the second-tier Kosdaq market at the KRX headquarters in Seoul on Friday. (The Korea Exchange)
Celltrion President Kim Hyeong-gi (second from left), Celltrion founder Seo Jung-jin (center), Celltrion Healthcare Chief Executive Officer Kim Man-hoon (third from right) and officials from market operator Korea Exchange celebrate the initial public offering of Celltrion Healthcare on the second-tier Kosdaq market at the KRX headquarters in Seoul on Friday. (The Korea Exchange)
With the IPO, Celltrion Healthcare became No. 2 in market cap, pushing another biopharma firm Meditox to third place. It also became one of the seven biotech firms among the top 10 largest Kosdaq-listed firms.

Backed by Celltrion’s robust performance in terms of overseas sales, Celltrion Healthcare’s price-earnings ratio will drop by half in 2020 to reach 14.6, from a 2018 projection of 27.6, Han Byung-hwa, an economist at Eugene Investment & Securities, wrote in a note Friday.

The lower a company’s price-earnings ratio, the more undervalued the company. The current price-earnings ratio is estimated at 45.6.

In addition, Friday’s IPO will “enhance transparency surrounding Celltrion as a whole” Han added.

Founded in 1999, the firm got final approval for entry from the market operator, Korea Exchange, on Wednesday.

On July 20, Celltrion Healthcare set the share price for the public offering at 41,000 won after two days of share offering to investors. It raised some 1 trillion won through the public listing, the largest ever in the IPO on Kosdaq. Its initial market cap came to 5.6 trillion won.

The KRX gave Celltrion Healthcare the greenlight for its IPO on March 14.

Seo Jung-jin, founder of Celltrion, currently owns 36.18 percent of shares in Celltrion Healthcare.

By Son Ji-hyoung (consnow@heraldcorp.com)
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