SK Shieldus, the South Korean security service subsidiary of SK Group’s ICT arm SK Square, said on Friday that it has scrapped its plans for market debut, citing dampened investor sentiment.

“We have submitted a delisting notice to the Financial Supervisory Service because the recent demand forecasting, which decides initial public offering prices, showed that our corporate value may not be well received,” the company said.

Stressing that market sentiment has turned sour following global economic uncertainties, the company added it will restart the IPO process when market conditions improve.

But Industry insiders say the sluggish demand for SK Shieldus’ IPO comes as the company’s corporate value is said to be overrated. The company was aiming to attract up to 3.55 trillion won ($2.79 billion) through the IPO, which was slated for May 19.

In the course of calculating its IPO price, the company compared average stock prices of local security service providers like S-1 Corp., Taiwan Secom Co., AhnLab and Cyberone.

However, AhnLab, the IT security firm founded by Ahn Cheol-soo -- the leader of the transition committee for President-elect Yoon Suk-yeol -- had seen an unusual spike in its stock price during March. Before logging a record high of 218,500 won, the stock price has averaged around only 70,000 won. If AhnLab had been eliminated from the calculation, the IPO price of SK Shieldus couldn’t have been that high, sources said.

“Although SK Shieldus lags behind S-1, a bellwether security firm, in both sales revenue and profit, the company had sought to raise even higher market cap than the rival,” said Choi Nam-gon, researcher at Yuanta Securities, in a report.

Choi added that of the 27.1 million shares the company aims to float, almost half of them will go to Blue Security Investment -- a special purpose company of Macquarie Finance Korea and the second largest shareholder -- since it is selling some of the existing shares to the public in order to cash them.

Sources say SK Shieldus’ sudden withdrawal of IPO may have a negative impact on the market debut of SK Square’s other affiliate, One Store. The mobile app marketplace operator plans to go public later this year.

Meanwhile, SK Shieldus became the first SK Group affiliate to have failed in making mega-sized deals like those made by SK Biopharmaceuticals, SK Bioscience, SK IE Technology Co. and SK REIT.

SK Shieldus, formerly known as ADT Caps, changed its name in October last year, seeking to transform into a comprehensive life care platform. The company currently provides services on cybersecurity, convergence security, physical security, and safety and care in both real world and virtual communities. Last November, the company was spun off from Korea’s largest telecom carrier SK Telecom.