Kakao Games, the game developing unit of South Korean mobile giant Kakao, made a strong market debut Thursday, trading at more than double the initial public offering (IPO) price.

As of 10:10 a.m., Kakao Games traded at 48,000 won ($40.49), twice the IPO price, and instantly surged by the daily permissible limit of 30 percent to 62,400 won per share. Its market capitalization stood at 4.6 trillion won, the fifth largest on the secondary, tech-laden KOSDAQ market.

The game publisher raised some 384 billion won via the IPO.

Prior to its IPO, investors rushed to Kakao Games for its growth potential amid the coronavirus pandemic. They chipped in 58.5 trillion won in deposits to buy its stocks, the largest in the country's IPO history.

Last year, Kakao Games posted an operating profit of 35 billion won on sales of 391 billion won.

In the first half of this year, its operating profit came to 28.7 billion won, up 63.7 percent from a year earlier.

The gaming company plans to use the proceeds from the IPO in developing a lineup of new games, including Elyon and Odin. The firm is pushing to launch the two large-scale massively multiplayer online role-playing games (MMORPG) by the end of this year.

Kakao Corp. owns the largest 58.96 percent stake in Kakao Games, which has been broadening its presence not only in South Korea but across Asia with the help of KakaoTalk after its inception in April 2016.

Kakao Games currently has over 45 million monthly active users.

"Kakao Games is expected to log gains in the short run thanks to the estimate-beating performance of its latest project Guardian Tales and the upcoming launch of Elyon and Odin," said SK Securities analyst Lee Jin-man.

"Kakao's platform, content environment and active M&A strategy create great advantages for Kakao games," he added. (Yonhap)