Hotel Lotte is expected to cut its estimated market value and initial public offering price due to a bearish stock market and uncertainties in the duty-free business, sources familiar with the matter said on Wednesday.

“The offer price is being considered at around 100,000 won ($82.30) to allow more retail investors to participate in the IPO,” the source said on condition of anonymity,

The hotel unit of South Korean retail giant Lotte Group has been preparing to go public on the Seoul bourse soon as part of reforms for recovering its image following a power struggle between two of the Lotte founder’s sons.

Lotte has not yet revealed the size of the IPO or price band, but the company said it would be set at an affordable level for individual investors.

The 100,000 won is much lower than share prices of other Lotte affiliates listed on the bourse, and also below the offer price for Lotte Shopping that made its 2006 market debut at 400,000 won per share.

When Lotte Group chairman Shin Dong-bin announced plans to list Hotel Lotte in August, its market value was estimated at around 20 trillion won.

However, that value suffered a blow after Lotte failed to renew its license for running duty-free stores at Lotte World Tower last year.

(khnews@heraldcorp.com)