Event to cover profitability, business sustainability and valuation beyond growth potential

Experts to walk through full IPO process from fundraising to listing review and accounting

[Provided by Samjong KPMG]
[Provided by Samjong KPMG]

Samjong KPMG announced Friday it will host a private session for software companies preparing to go public. The event is scheduled for Oct. 1 at the firm's headquarters in Gangnam Finance Center in Yeoksam-dong, Gangnam-gu, Seoul.

South Korea's IPO market has been shifting toward a "qualitative screening" approach that places earnings and profitability at the center of company evaluations. Tangible business results, visible profitability and reasonable valuation are increasingly the key benchmarks, eclipsing growth potential and revenue expansion.

Technology-driven software companies — including those in AI, software-as-a-service, cloud and platform sectors — are no exception. The Korea Exchange and investors are scrutinizing more closely whether a company's technological capabilities can translate into actual sales and profitability, and whether its business model and customer base are sustainable.

The Korea Exchange has been rolling out sector-specific listing standards since introducing them for the biotech sector in 2019, followed by AI, space and energy in December last year, and advanced robotics, K-content and cybersecurity in July. For companies listed under the technology special-exception regime, the rules governing exemptions from sales and large-loss delisting requirements have been tightened. The current system grants a three-to-five-year waiver on those requirements, but the exemption will now apply only when a special-exception listed company discloses a plan to enhance its corporate value during the grace period.

A company's overall management and governance capabilities have also emerged as important evaluation factors, as the market has shifted toward long-term investment driven in part by expanded mandatory lock-up commitments from institutional investors. Companies preparing for a listing must build systematic frameworks for accounting transparency, internal controls, financial management and valuation logic from the earliest stages of IPO preparation.

The session will feature speakers from the IPO, investment, listing review, and accounting and finance fields. They will share key issues that software companies must address when preparing for a listing in the changed market environment, covering practical strategies across the full IPO process — from pre-listing fundraising and responding to exchange reviews to building accounting and financial frameworks.

Deputy CEO Kang In-hye, leader of Samjong KPMG's IPO Support Center, will open by presenting recent IPO market trends and the evolving investment landscape. She will analyze the tightening of qualitative screening in the IPO market and the key factors drawing investor attention, and outline what pre-IPO companies need to demonstrate their value and growth potential to the market effectively.

Kim Tae-gyu, vice president at A Ventures, will present on strategies for attracting pre-listing investment. His session will examine how investors assess a company's growth potential, profitability and business model, and share strategies for enhancing corporate value and securing investment.

Park Byung-jin, team leader at Daishin Securities, will cover recent listing review trends at the Korea Exchange and regulatory changes. He will explain the key risks that can arise during the listing review process and how to address them, focusing on practical checklist items companies should examine before a review and points to watch during the process.

Closing the session, Kim Young-sun, managing director at Samjong KPMG, will present on an accounting and financial roadmap for pre-IPO companies. The presentation will examine the accounting and financial management frameworks needed during designated audits and IPO preparation, and present key accounting issues that arise in designated audits alongside practical case studies.

"The IPO market is changing from one where companies were valued on growth potential alone to one where they must prove the sustainability of that growth through actual business results and profitability," Kang said. "Particularly for software companies where technological innovation moves fast, it is important to demonstrate through objective indicators that technological competitiveness can translate into sales, profitability and a stable business model."


park.jiyeong@heraldcorp.com