LS Securities' debut $59M bond draws 6.6x demand, prices below rating average
What's the deal? LS SecuritiesDealroom has a profile for this one. Try Dealroom → raised US$58.7M in its first public corporate bond issuance under its current name, drawing orders worth more than six times the offering. The unsecured bonds attracted a total of US$389M in bids during bookbuilding.
The breakdown: The 18-month tranche, targeting US$33.5M, pulled in US$177.7M, while the two-year tranche, seeking US$25.2M, drew US$211.3M. The 18-month tranche priced 1bp below the average credit spread for its rating; the two-year tranche priced at the average.
What's the money for? Proceeds go entirely to repaying existing debt, including US$8.38M in commercial paper and US$25.2M in electronic short-term bonds. On the strong demand, LS Securities can expand the issuance to as much as US$117.4M, with any extra also funding debt repayment.
Why now? The deal marks the firm's debut in the public corporate bond market under its new brand. Formerly eBest Investment & SecuritiesDealroom has a profile for this one. Try Dealroom →, it joined LS GroupDealroom has a profile for this one. Try Dealroom → in January 2024 when LS NetworksDealroom has a profile for this one. Try Dealroom → became its largest shareholder, then renamed itself in June that year.
By the numbers: Recent results have improved, with first-half standalone operating profit reaching US$142.5M, up 127.6% year-over-year. Net income rose 120.8% to US$64M.
What could go wrong? Capital pressure from expanding operating assets remains under scrutiny. The standalone leverage ratio reached 856.5% at the end of the first half, up from 846.0% at the end of last year and above the 751.0% average for domestic securities firms.
The signal: Oversubscribed pricing below the rating average suggests investors are comfortable with LS Securities' credit despite the elevated leverage. Kiwoom SecuritiesDealroom has a profile for this one. Try Dealroom →, KB SecuritiesDealroom has a profile for this one. Try Dealroom →, and NH Investment & SecuritiesDealroom has a profile for this one. Try Dealroom → are leading the issuance, scheduled for the 21st.
Read more: en.infomaxai.com
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