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Krafton raised $3.75 billion in on public offering, but the maker of PlayerUnknown’s Battlegrounds (PUBG) saw its share price close 9% down in the first day of trading Tuesday.

The South Korean company tried to go out with a valuation that was too high, and investors balked, analysts told Reuters. The company debuted at $432 a share (498,000 won), but shares at the very outset traded at 9.9% below that price. They tumbled as much as 20% before recovering and closing down 8.8%. At the closing price, the valuation was $19.32 billion. The price for the initial shares was lower than the company had originally tried to launch at, but it evidently didn’t lower the price enough.

One banking expert told GamesBeat that the shares were “massively overpriced for a one-franchise asset.” Of course, Krafton is raising the money to invest in a variety of other games. It has already bankrolled Striking Distance Studios, which Glen Schofield cofounded (he’s the co-creator of the Dead Space series and a former Call of Duty developer). Striking Distance is working on the Callisto Protocol, a new horror game.

The Callisto Protocol is coming in 2022.

Above: The Callisto Protocol is coming in 2022.

Image Credit: Striking Distance Studios

To date, PUBG Mobile (localized as Game For Peace in China), has generated $6.3 billion in lifetime player spending from the App Store and Google Play, according to measurement firm Sensor Tower. During the first half of 2021, PUBG Mobile generated $1.5 billion in revenues, representing a rise of approximately 5% growth year-over-year.


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In 2020, PUBG Mobile was the No. 1 app globally by player spending on the App Store and Google Play combined, generating $2.7 billion. It ranked above the likes of Honor of Kings, TikTok, and Pokémon Go.

Krafton gets 87% of its revenue from Asia. Its backer, Tencent, handles sales in China under the Game For Peace brand. Krafton also provides tech services for Peacekeeper Elite, a similar game that Tencent distributes in China as well. The heavy dependence on China is considered a risk because the Chinese regulators have been cracking down on gaming.

Krafton also got caught in the political turmoil between India and China, as India banned China-originated products. Krafton had to rebrand PUBG as Battlegrounds Mobile India after months of delay. CEO Kim Chang-han has said that Krafton plans to launch new games this year and next and create short films and animations. Most of the money will be used for acquisitions.

About 65% of the money raised went to Krafton, while selling shareholders got the rest.

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