Nearthlab, a maker of autonomous flying drones based on physical artificial intelligence, tumbled more than 30% on its Kosdaq debut. The company drew strong demand in both institutional book-building and its retail subscription, but sellers flooded in after the listing and shares closed well below the offering price.
Nearthlab closed at 28,650 won, down 12,550 won, or 30.46%, from its offering price of 41,200 won, the Korea Exchange said on the 24th. The stock rose to 42,000 won shortly after the open before turning lower and finished at its intraday low.
The company, which listed on the Kosdaq market that day, built its autonomous flight technology in the wind-turbine inspection market on its core physical AI capabilities before moving in earnest into the defense business in 2024. Leading with its Caiden counter-drone hard-kill solution and its Zaiden swarm-strike solution, it has secured references including exports to Singapore and the United Arab Emirates and a rapid pilot project with South Korea's Defense Acquisition Program Administration.
In its book-building for institutional investors, 1,795 firms at home and abroad took part, producing a demand ratio of 743.5 to 1. With 98.0% of the participating volume bidding at or above the top of the target offering range of 30,000 to 41,200 won, the offering price was set at the top end of 41,200 won. That put the total offering size at about 37.5 billion won ($27 million), with an expected market capitalization of about 238 billion won ($172 million) based on the offering price.
In the retail subscription held on the 12th and 13th of this month, the stock drew a ratio of about 530 to 1 and pulled in about 2.5 trillion won ($1.8 billion) in deposits. Despite that strong investor interest from book-building through the retail subscription, it failed to translate into a share-price gain on the first day of trading.
Kido Industrial, a maker of high-performance woven medical products that listed on the Kosdaq on the 21st of this month, also closed its first day down 34.58%. With market funds concentrating in large-cap stocks and a few leading sectors, newly listed shares have shown a pronounced pattern of profit-taking right after their debuts.
