Officials attending the KOSPI new listing ceremony of Kakao Pay held at the Korea Exchange in Yeouido, Seoul on the 3rd of last month, are celebrating the start of trading. [사진 제공 = 한국거래소]Kakao Pay, which debuted brilliantly on the KOSPI in November of last year, recorded a 37.22% drop compared to its highest price in two months of listing. This is because investor sentiment has deteriorated due to the large-scale stock sale by Kakao Pay executives. Management has apologized to help the situation evolve, but investors are still looking cold.
As of 11:03 am on the 6th, Kakao Pay is trading at 153,500 won, down 4,500 won (2.85%) from the previous day. At one point during the morning of that day, it was down to 4.43%. Kakao Pay plunged 6.51% the day before and 4.25% on the 4th. In the new year alone, it was delayed by 12.32%. Compared to the high, the decline is even greater. Compared to 148,500 won on November 30, last year, when Kakao Pay recorded a new price, it fell by a whopping 38.23% until today.
Last month, eight key executives, including Kakao Pay’s nominee Shin Won-geun and current CEO Ryu Young-joon, sold their stakes. On the 10th of last month, Kakao Pay announced that it had sold 440,000 shares owned by eight executives. It was reported that major executives exercised stock options within regarding a month of Kakao Pay’s stock market debut and made a profit of regarding 10 billion won, acting as a bad news for the stock price. This is because management’s sell-off usually signals a short-term high in the market, causing investor sentiment to freeze sharply.
In response, the new nominee and CEO Ryu apologized for the sale of their stake by the management, including them, but investors’ anger has not subsided. In particular, former CEO Ryu announced that he would exercise all stock options by the first half of this year, which is being criticized even more.
The new nominee held an in-house meeting on the 4th and said, “I apologize to stakeholders, including shareholders and employees, who must have been very heartbroken. We will strengthen responsible management to prevent this from happening.” He added, “I will not sell my stocks during the two-year term following taking office.” He added, “Even if we sell stocks due to unavoidable circumstances, we will disclose relevant information transparently and actively communicate to minimize the impact on the stock price.”
Ryu also announced that he would exercise all of his stock options within the first half of this year, as he will start his term as Kakao CEO in March. This is to prevent conflicts of interest that arise when the representative of Kakao owns shares in the subsidiary Kakao Pay. Kakao Pay explained that it was considering ways to minimize risks, such as selling stocks to institutions with long-term holding intentions and setting a period of protection, but investors are still skeptical.
Investors in the online stock community commented, “Are the CEO just going to apologize and the end?”, “Sorry, will they have to buy back what they bought?” The profit from apples is 10 billion won,” and “It seems that shareholders are increasing their medicine.”
Meanwhile, the stock market remains silent regarding Kakao Pay. Four Kakao Pay company analysis reports came out in October and eight reports last month, but not a single report has been released since December.
[김정은 매경닷컴 기자]
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