Car-sharing firm SOCAR confident of successful IPO

▲ 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. (PHOTO NOT FOR SALE) (Yonhap)

car-sharing firm-IPO plan

Car-sharing firm SOCAR confident of successful IPO

By Chung Joo-won

SEOUL, Aug. 3 -- 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 from institutional and retail investors by next week.

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.

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.

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