[Edaily Reporter Shin Ha-yeon ] The slump in the domestic initial public offering (IPO) market is dragging on. With the number of companies going public this year falling to about half of last year’s level, the average first-day return on newly listed stocks has also been negative for two consecutive months. The process of separating the wheat from the chaff among small and mid-cap companies planning IPOs this month is expected to intensify.

According to the Korea Exchange and the financial investment industry on the 4th, the average return—based on the closing price on the first day of trading—for the four companies newly listed on the KOSDAQ market last month—#MadUp, #LemonHealthcare, #Remedy, and #HLGenomics—was -1.23% compared to their offering prices. Currently, the stock prices of all these companies are trading below their IPO prices. On that day, Remedy closed at 8,500 won, down nearly 60% from its IPO price (20,700 won), while HL Genomics (21,500 won) also closed at 9,980 won, roughly half its IPO price. LEMON COMPANY LIMITED (10,000 won) and Madup (8,000 won) also fell 40.90% and 8.50%, respectively, below their IPO prices.

The average return on the first day of trading for StradVision, Justech, and PIECE PEACE STUDIO Co., Ltd.—which went public last June—was also a mere -11.97%. This stands in contrast to last May, when three stocks—COSMO ROBOTICS CO., Ltd., Poled Co., Ltd., and MakinaRocks Co., Ltd.—all more than quadrupled in value on their debut.

This is interpreted as a sign that short-term supply and demand—which had been driving up stock prices in the early stages of listing—has weakened amid recent increased market volatility. There is also a growing number of cases where high competition ratios in bookbuilding and public subscription do not translate into post-listing stock price gains. In the case of Madup, the public subscription by retail investors recorded a competition ratio of 3,304.8 to 1—the highest in the past five years—and the stock price rose by as much as 178.1% compared to the offering price immediately after listing. However, the first-day closing price return shrank to 26.0%, and the stock is currently trading below the offering price.

According to SamsungSecurities, the average subscription competition ratio for retail investors in newly listed stocks this year was 1,768.7 to 1, surpassing last year’s ratio of 1,100 to 1. However, only two companies—COSMO ROBOTICS CO., Ltd. and MakinaRocks Co., Ltd.—currently trade above their initial public offering (IPO) prices. Kang Young-hoon, an analyst at SamsungSecurities, noted, “While most small- and mid-cap stocks are performing well during the bookbuilding and subscription phases—with prices at the upper end of the offering range and high subscription competition ratios—there is a polarization in returns among individual companies after listing.”

The quantitative contraction of the IPO market is also evident. So far this year, excluding SPACs and SPAC mergers, there have been 21 new listings, a 54.35% decrease from the 47 listings during the same period last year. Cumulative IPO proceeds from the beginning of the year through last month totaled 1.2488 trillion won, a 48.6% decrease compared to the same period last year.

The securities industry views the IPO market as having been relatively sidelined, as funds have concentrated on certain large-cap stocks—such as semiconductor companies—despite the rise in the domestic stock market. The fact that companies have postponed their listing schedules due to policy uncertainty regarding dual listings has also had an impact.

Choi Jong-kyung, an analyst at HEUNGKUK METALTECH CO.,LTD., stated, “We assess that the slump in the new IPO market in 2026 was largely influenced by the dual-listing guidelines announced last July,” adding, “The repeated delays in the financial authorities’ announcement of the guidelines ultimately halted the momentum of companies preparing for new listings.” He went on to note that the sharp rise in the stock market has dampened interest in the initial public offering (IPO) market, describing this as “the shadow of the stock market boom.”

This month, six companies—DILLI ILLUSTRATE INC., K&S I&C Technology Co., Ltd., Gido Industries, Nears Lab, Big Wave Robotics, and HatchTech LTD.—are preparing for KOSDAQ listings. All are small- and mid-cap companies with an expected market capitalization of 300 billion won or less; even if the offering price is set at the upper end of the target range, the total offering amount is projected to be 235.6 billion won, a 72.5% decrease compared to the same month last year.

Meanwhile, there are expectations that the market sentiment could reverse if major companies such as Sono International, Musinsa, and Gudai Global proceed with their IPOs in the second half of the year. Analyst Kang predicted, “We expect investor sentiment toward IPO shares to gradually improve as uncertainties related to the announcement of dual-listing guidelines are resolved, major companies move forward with their listings, and the introduction of pre-IPO demand forecasting and the cornerstone investor system takes effect.”