[Edaily Marketin KIM YEON-SEO Reporter] As the liquidity crisis at JoongAng Group spreads across the entire group, dampening investor sentiment in the credit market, only two companies—Hotel Lotte and CHONGKUNDANG HOLDINGS CORP.—will conduct bookbuilding for institutional investors in the corporate bond market this week. With corporate bond issuance having plummeted recently, attention is focused on whether these two companies will be able to secure a significant level of institutional demand.

According to the investment banking (IB) industry on the 22nd, Hotel Lotte (AA-) and CHONGKUNDANG HOLDINGS CORP. (A+) will conduct bookbuilding among institutional investors this week (June 22–26) for public corporate bond offerings.

Hotel Lotte to Raise Up to 2000억원… Hopes for Duty-Free Store Recovery

Lotte Hotel will conduct a bookbuilding process for institutional investors on the 23rd. The total offering size is 100 billion won, structured into tranches (maturities) of 60 billion won for the 2-year bond and 40 billion won for the 3-year bond. Depending on the results of the bookbuilding, the company has left open the possibility of increasing the issuance amount to a maximum of 200 billion won.

The target interest rate band for the public offering has been set at -30 to +30 basis points (bps; 1 bp = 0.01 percentage points) relative to the ratings provided by individual private bond rating agencies. The lead underwriters are NH INVESTMENT & SECURITIES, KB Securities, SamsungSecurities, KIWOOM Securities, Hana Securities, and DaishinSecurities.

The three major domestic credit rating agencies—Korea Ratings Corporation, Korea Credit Rating, and NICE Credit Rating—have assigned Hotel Lotte a credit rating of “AA-” with a “Stable” outlook. The rating agencies view positively the fact that Hotel Lotte has secured an excellent market position in the duty-free and hotel sectors.

Earnings are improving, particularly in terms of profitability. Although consolidated revenue for the period ending September 2025 decreased by 9.5% year-over-year, profitability improved as cost burdens eased. The EBIT margin (EBIT/revenue) stood at 4.8%, marking a return to operating profitability. The EBIT margin is an indicator of the profit generated from revenue through operating activities.

Cash flow and financial metrics have also improved to some extent. As cash generated from operations increased and inventory burdens decreased, consolidated net debt as of the end of September 2025 fell to 5.9 trillion won. Net debt refers to the actual debt that must be repaid, excluding cash on hand and other assets. As of the same date, the debt-to-equity ratio stood at 115.5%, and the debt dependency ratio was 36.7%, both showing slight improvements compared to the end of the previous year.

CHONGKUNDANG HOLDINGS CORP. Anticipates Benefits from Wegovy… Plans to Issue Up to 1000억원

CHONGKUNDANG HOLDINGS CORP. will conduct a bookbuilding process on the 24th. The total offering size is 600억 won, consisting of 300억 won in 2-year bonds and 300억 won in 3-year bonds. Depending on the results of the bookbuilding, the company is considering increasing the issuance amount to a maximum of 1000억 won. The lead underwriters are KB Securities and SamsungSecurities.

The target interest rate band for the public offering has been set at –30 to +30 basis points relative to the rating from a private bond rating agency with an ‘A+’ rating.

CHONGKUNDANG HOLDINGS CORP. is a holding company with subsidiaries including CHONGKUNDANG, KYONGBO PHARMACEUTICAL CO., LTD., and CKDBioCorporation. Recent positive investment factors include the impact of domestic distribution of the obesity treatment “Wegovy” and expectations of improved performance from major subsidiaries.

Korea Ratings Corporation and NICE Credit Rating have assigned CHONGKUNDANG HOLDINGS CORP. a credit rating of “A+ (Stable).” They assess that the company maintains excellent levels of profitability and financial stability, particularly in its pharmaceutical division. While increased investment burdens are cited as a concern, they believe the company can manage its financial stability based on its strong operating cash flow generation.

The market views the results of this week’s corporate bond bookbuilding as a barometer for gauging the recent downturn in credit investment sentiment.

A bond market official stated, “Given the recent unfavorable market sentiment, this bookbuilding process will serve as a barometer for future corporate bond market conditions,” adding, “Lotte Hotel possesses a strong credit rating, and CHONGKUNDANG HOLDINGS CORP. is expected to attract sufficient demand given the strong performance of its subsidiaries.”