| "How much market share will be increased in African market due to the newly developed malaria-diagnostic reagent?" A person in an investment company based in Hong Kong raised diverse questions to CEO Choi Young-ho of Access Bio, a company listed in KOSDAQ. A person in Access Bio swiftly reacted to the questions, putting the diagnostic reagent samples on the table and showing financial status of Access Bio through large TV screen. The local investor spent one hour there for detail inquiries. The personnel requested additional company information so that the investment company can decide whether to invest or not, and went to the next door where a different company was waiting to attract investors.
KOSDAQ-listed companies held an investor relations (IR) event for Hong Kong-based investors on last Wednesday, followed by the same session in Singapore on Friday.
The twelve companies participating in the IR event took a hotel guest room each in order to meet 54 local investors. The hotel lobby and guest rooms were fully customized for investors as comfortable as possible, but there were very few people who relaxed there. Choi was also busy in meeting eleven investors for eight hours excluding lunch time.
○ `The only investable market in Asia`
Almost all participating company staff look happy in spite of busy day, because many institutional investors in Hong Kong and Singapore showed huge interest in investing in Korean SMEs. The main reasons why those investors were interested were "Possible to make diverse portfolio" and "there are many undervalued companies".
Kim Sang-hyeon, Hong Kong branch head of Japanese investment company Sumitomo Mitsui Asset Management, said, "We anticipate shipbuilding, electronics, and IT companies will be extremely profitable when export booms. Then KOSDAQ-listed companies supplying to those companies will also take a benefit. This is why Hong Kong investors are interested."
The fact that investors can invest in diverse areas such as manufacturing, services, and domestic market, also attracted investors to get into Korean market investment. A senior portfolio manager based in Singapore said "It is possible to make diverse portfolio utilizing IT, domestic market, shipbuilding, steel, and services. Strong domestic market is an additional benefit. Amid gloomy economic situation in east-Asian countries, there are very few investment opportunities in Asia except Korea.
Some foreign companies also planned to list in Korean securities market. "Especially some Chinese companies listed in Hong Kong securities market are positively considering to list in Korean market," said Kim Jong-seon, Global Business team head of KDB Daewoo Securities.
○ `Number of insufficient trading stocks and short-term foreign fund will be hurdles`
Korea Exchange and KOSDAQ opened the same event in September last year. Though the number of participating companies year-on-year decreased by one, this year`s IR event has been evaluated successful in consideration of financial crisis in East Asian countries."Several institutional investors requested company information considering long-term investment," said HaanSoft Vice Chairman Lee Hong-gu, who took part in the event for the second year.
A local institutional investor said, however, "Though Korean SMEs are good investment opportunities, there are several challenges in real investment." The investor added, "Korean SMEs where owner and owner-related persons have large shares are not easy to be invested due to insufficient number of traded stocks. It is difficult to buy or sell at a right timing and also not easy to make a profit. This is a reason why some investors are reluctant to invest."