Hanjin Group (BBB+) failed to fully subscribe its corporate bond issuance during demand forecasting conducted on the 14th, according to investment banking industry sources. The logistics company sought to raise 400 billion won through bond sales but received a total of 440 billion won in purchase orders, with the 1-year maturity tranche falling short by 10 billion won despite offering the upper band interest rate. The bond issuance aims to refinance 700 billion won in corporate bonds maturing on the 22nd, with the shortfall to be covered by the company's own funds.
Hanjin Bond Issuance Shows Mixed Tranche Results
According to the investment banking industry on the 14th, Hanjin conducted demand forecasting for a 400 billion won corporate bond issuance and received total purchase orders of 440 billion won. By tranche, the 1-year maturity bond seeking 200 billion won received 190 billion won in orders, resulting in a 10 billion won shortfall. The 1.5-year maturity bond seeking 200 billion won received 250 billion won in orders.
Hanjin presented a hoped-for interest rate band of ±50bp relative to the individual private placement rate. The 1-year tranche failed to fill the募集 amount even at the upper band of +50bp, while the 1.5-year tranche filled purchase orders at the private placement rate level.
NH Investment & Securities, KB Securities, Korea Investment & Securities, Kiwoom Securities, and Daishin Securities served as lead underwriters.
Hanjin Allocates Funds for Bond Refinancing
The raised funds will be used to refinance 700 billion won in corporate bonds maturing on the 22nd. The company plans to cover the shortfall with its own retained funds.
Hanjin Reports Q1 Revenue Growth Amid Profit Decline
Hanjin recorded consolidated revenue of 779 billion won in Q1, an increase of 6.8% compared to the same period last year. The growth reflected strong performance in global businesses including forwarding and fulfillment driven by K-beauty and other K-brand export growth, as well as new contract wins in land transportation and raw material handling.
However, operating profit decreased 27.4% to 19.8 billion won due to reduced container volume at ports resulting from Middle East geopolitical risks and an increased proportion of low-price volume in the parcel delivery sector.
Hanjin Maintains Debt Ratio at 183.6%
As of the end of Q1, Hanjin's consolidated debt ratio stood at 183.6%, with borrowing dependence at 49.6%.
FAQ
What happened with Hanjin's bond issuance on the 14th?
Hanjin failed to fully subscribe its 400 billion won corporate bond issuance during demand forecasting on the 14th, receiving 440 billion won in total orders but falling 10 billion won short on the 1-year maturity tranche despite offering the upper band interest rate of +50bp.
Why is Hanjin issuing corporate bonds?
Hanjin is issuing the bonds to refinance 700 billion won in corporate bonds maturing on the 22nd, with any shortfall to be covered by the company's own retained funds.
How did Hanjin perform financially in Q1?
Hanjin recorded Q1 consolidated revenue of 779 billion won, up 6.8% year-over-year, driven by global business growth in forwarding and fulfillment, but operating profit declined 27.4% to 19.8 billion won due to reduced port container volumes and increased low-price parcel delivery volume.
