[Edaily Marketin KIM YEON-SEO Reporter] The corporate bond issuance market, which had been virtually at a standstill until mid-August, has begun to pick up again ahead of September. This week, companies with A-rated credit ratings are set to conduct bookbuilding for institutional investors one after another.

According to the investment banking (IB) industry on the 23rd, Lotte Corporation (A+), Hanwha REIT (Hanwha REIT, A+), and SAMYANG PACKAGING (A-) will conduct bookbuilding this week (August 24–28) for public corporate bond offerings. Kyobo Life Insurance (AA0) will issue hybrid capital securities (perpetual bonds).

On the 25th, Lotte Corporation will conduct a bookbuilding process for corporate bonds totaling 80 billion won, consisting of 40 billion won in 2-year bonds and 40 billion won in 3-year bonds. The company plans to increase the issuance amount to a maximum of 150 billion won depending on institutional demand. The target yield band has been set at -30 basis points (bps; 1 bp = 0.01 percentage point) to +30 bps relative to the yields assessed by individual private bond rating agencies for each maturity.

Eight firms are participating as lead underwriters, including NH INVESTMENT & SECURITIES, KB Securities, Korea Investment & Securities, Shinhan Investment & Securities, KIWOOM Securities, DaishinSecurities, Hana Securities, and Woori Investment & Securities.

Hanwha REIT plans to issue corporate bonds totaling 200 billion won, divided into 1-year and 1.5-year maturities. It will conduct a bookbuilding process on the 28th and issue the bonds on the 4th of next month. The target yield range is -30 to +30 basis points relative to the average yield for bonds of the same rating. NH INVESTMENT & SECURITIES, SamsungSecurities, Shinhan Investment, and KIWOOM Securities are serving as lead underwriters.

SAMYANG PACKAGING will also conduct a bookbuilding process on the 28th for 60 billion won in 2-year corporate bonds. Depending on the results of the bookbuilding, the company plans to increase the issuance amount to a maximum of 100 billion won. The target yield band has been set at -30 to +30 basis points relative to the individual credit rating average yield. The lead underwriters are NH INVESTMENT & SECURITIES and KB SECURITIES, and the scheduled issuance date is the 4th of next month.

Kyobo Life Insurance will conduct a book-building process for 300 billion won in hybrid capital securities on the 24th. Although the maturity is 30 years, the structure is a 30-year term with a 5-year call option (30NC5), allowing for early redemption five years after issuance. The target yield range has been set at a fixed annual rate of 4.8% to 5.4%.

KYOBOSECURITIESCO.,LTD. plans to increase the issuance amount to a maximum of 500 billion won depending on the results of the bookbuilding. NH INVESTMENT & SECURITIES, Shinhan Investment & Securities, and Korea Investment & Securities are serving as lead underwriters, and the issuance date is set for the 31st of this month.

Given the recent confirmation of investor demand for A-rated corporate bonds, the market expects this week’s bookbuilding to yield generally favorable results. Lotte Construction (A0) received orders totaling 151 billion won—more than three times the target amount—during its bookbuilding on the 19th, which aimed to raise 50 billion won. Hana F&I (A+) also saw strong demand on the 27th of last month, raising 700 billion won against a target of 150 billion won.

A bond market official stated, “With absolute interest rates on the rise, A-rated corporate bonds are gaining investment appeal because they offer higher yields than investment-grade bonds while carrying lower credit risk than BBB-rated bonds,” adding, “However, investor preferences may vary depending on the industry and financial structure.”