Secrets to Successful IPOs in Japan’s $7.6 Trillion Market: Insights from Korean and Japanese Experts

Samil PwC Hosts IPO Seminar
Presents Practical Roadmap for Cross-Border Listings

An increasing number of domestic companies are considering listing on the Japanese stock market, which boasts a market capitalization of USD 7.6 trillion (approximately KRW 1,154 quadrillion). This is attributed to Japan's stable regulatory environment and solid global investor base.

On June 12, accounting firm Samil PricewaterhouseCoopers (PwC) announced that it held a seminar titled "Introduction to Key Processes and Core Strategies for Listing in Japan" on June 11 at the Sejong Hall of its headquarters in Yongsan-gu, Seoul.

This seminar was organized for domestic companies and investors interested in listing in Japan. Experts from Samil PwC's global initial public offering (IPO) team, as well as specialists from the Japan Exchange Group and securities firms, participated to share strategies for entering the Japanese capital market and practical considerations.

The seminar consisted of six sessions: (1) Overview of the Japanese market and listing system; (2) Public offering regulations under domestic law; (3) Listing process; (4) Support from securities agents before and after cross-border listings; (5) Listing readiness assessment and roadmap; and (6) Financial accounting preparation strategies.

Jung Heo, Partner at Samil PricewaterhouseCoopers (PwC), spoke at the seminar titled "Introduction to Key Processes and Core Strategies for Listing in Japan," held on the 11th at the Sejong Hall of Samil PwC headquarters in Yongsan-gu, Seoul. Heo, who planned this seminar, stated, "Listing in Japan is not simply about entering an overseas capital market but a process of advancing a company's financial reporting system, internal controls, and overall governance to global standards." He added, "Through this, companies can build highly reliable investment stories and lead to long-term enhancement of corporate value." Samil PwC

In the first session, Daegak Lee, Manager at the Japan Exchange Group, introduced the structure of the Japanese capital market and listing system. He noted that the Japanese stock market is known for its high proportion of global investors, providing both liquidity and stability. The market is segmented into Prime, Standard, and Growth sections, offering listing paths tailored to each stage of corporate growth. He added that cross-border IPOs, especially among Asian companies, have been on the rise recently.

In the second session, Kwonui Park, attorney at Kim & Chang, discussed public offering regulations under Korea's Capital Markets Act that apply to Japanese listings. Park emphasized, "Even if an IPO is conducted overseas, if domestic investors are solicited or if it meets the ‘offering or sale’ criteria, there may be a requirement to file a securities registration statement." He also advised that the issuance of overseas securities could still be regarded as a public offering depending on potential acquisition by domestic residents, resale restrictions, and brokerage involvement. Therefore, companies should thoroughly review the alignment with domestic regulations before proceeding with a Japanese IPO.

In the third session, Matsumoto, Managing Director at Daiwa Securities, explained the Japanese listing process from the perspective of a securities firm. He stated, "An IPO is more than just a screening process; it is a comprehensive project that requires thorough preparation and simultaneous investor marketing." He added that companies should systematically prepare internal controls, develop investment stories, and enhance corporate value years in advance of listing.

In the fourth session, Fujiwara, Manager at Mitsubishi UFJ Trust and Banking Corporation, outlined the role of securities agents and support measures for cross-border listings. Securities agents assist with equity structure adjustments and shareholder management systems during the preparation stage, and after listing, they handle overall shareholder-related work, such as managing general meetings and dividend payments. Fujiwara stressed the importance of choosing a listing structure that fits the company's strategy—whether through Japan Securities Depository Center, direct listing, or conversion to a holding company—and coordinating with all relevant IPO institutions.

In the fifth session, Kato, Partner at PwC Japan, emphasized the importance of IPO readiness assessments and tailored roadmaps for each company. He explained, "Preparing for an IPO is a company-wide project that covers accounting, taxation, internal controls, governance, and IT." He recommended conducting a preliminary assessment to identify key issues and systematically addressing them before listing. He also highlighted the need for establishing long-term business plans, building internal controls and disclosure systems, and collaborating with professional institutions such as lead managers and auditors as key factors for a successful listing.

In the sixth session, Jung Heo, Partner of the Global IPO Team at Samil PwC, stressed that companies need to align their financial reporting systems with Japanese market standards to list in Japan. He particularly pointed out the necessity of establishing a reporting process that accommodates differences between IFRS and Japanese Generally Accepted Accounting Principles (J-GAAP), and enables disclosure within 45 days after listing.

Girok Kim, Global IPO Leader at Samil PwC, stated, "It is difficult to pursue a Japanese listing based solely on information access." He emphasized the necessity of a thorough understanding of the system, market practices, and investor characteristics, as well as systematic preparation in advance. He added, "We hope this seminar will provide practical insights and execution strategies for companies considering listing in Japan."

This content was produced with the assistance of AI translation services.