Krafton, the South Korean game maker behind global smash hit PlayerUnknown’s Battlegrounds, has drawn lower-than-expected interest from retail investors for its initial public offering, with deposits for the stock offering at 5.04 trillion won ($4.38 billion) by its two-day public subscriptions’ deadline at 4 p.m. Tuesday, according to data compiled by its underwriters.

The amount for the accumulated subscriptions was far less than SK ie technology (80.9 trillion won) and SK Bioscience (63.6 trillion won), for which retail investors were allowed to make deposits through several brokerage houses that underwrote the IPO deals. The figure was nearly one-tenth of KakaoBank, which attracted 58.3 trillion won although multiple subscriptions were not allowed for its retail tranche.

Overall, Krafton’s shares were oversubscribed 7.79 times, while Mirae Asset Securities received public subscriptions as the lead underwriter of the game developer’s IPO. NH Investment & Securities and Samsung Securities also accepted retail investors’ bids as members of the underwriter group.

Bids placed in retail subscriptions on the first day of the preorder session came to some 1.8 trillion won, while the competition logged 2.79-to-1. The competition rate on the first day was much lower than other blockbuster deals -- KakaoBank (37.8:1), SK ie technology (78.93:1) and SK Bioscience (75.87:1) -- as the company’s IPO was referred to as the “last train” to place multiple subscriptions.

While Krafton is anticipated to raise up to 4.31 trillion won, which is likely to be the second largest in value in IPO market history here, competition among 621 domestic and overseas institutions during the book-building process marked 243 to 1. As a result, it priced the IPO at the upper end of the target price band of 498,000 won per share.

Some investors who passed up the chance to obtain new shares wrote on stock investment online communities: “It is a burdensome since the IPO price has been set too high,” “Krafton is not a retail investor-friendly stock” and “It is being traded lower than the IPO price on the over-the-counter market now, why would you place public subscription bids?”

“The phenomenon is not viewed as an IPO market bubble burst, but rather seen as small domestic investors’ cautious approach to place bids due to (Krafton’s) overvaluation concern,” said one brokerage official who requested anonymity.

Market insiders have conflicting opinions on the gaming giant’s stock price after its listing on the country’s benchmark Kospi on Aug. 10.

A local analyst who wished to remain anonymous said that Krafton’s valuation is “overrated.” Although it has a high possibility of early joining in major indexes such as the Kospi 200 and MSCI Korea, the price rise is likely to be limited amid high its IPO price, the expert said.

Some market watchers have given a fairly rosy outlook on the game developer’s stock price. They focused on the firm being a beneficiary stock, pointing to the digital, online and contactless trends triggered by the ongoing pandemic. KTB Investment & Securities analyst Kim Jin-gu gave a fair value of the stock price at 580,000 won, up 16 percent from its IPO price.

While the company’s preparation for new game releases, titled PUBG: New State and The Callisto Protocol, gets underway, other analysts predicted the firm to score a megahit and suggested investors hold the stock until its upward movement at the end of year.

“If the stock surges on the first day of its market debut, the valuation burden may arise ahead of the firm’s new game launches. ... If the company does not make a grand debut, investors are recommended to actively target PUBG: New State’s launch schedule,” said Sung Jong-hwa, an analyst at eBest Investment & Securities.