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Foreign investors are showing strong interest in South Korean battery maker LG Energy Solution (LGES)’s initial public offering (IPO) even before the company starts its IPO process in earnest.

LGES’ overseas underwriters have received subscription bids in advance from Tuesday at the request of large global institutional investors, according to industry sources. Foreign investors tend to show their intentions to participate in the subscription for mega IPO deals, which help underwriters predict demands more accurately.

Foreign investors have decided to make their investments on Tuesday, immediately after LGES unveiled the corporate value and IPO size, even before a deal roadshow takes place from January 3 to 11.

Three or four investors reportedly have made bids with an order size of around $500 million. There is a possibility that foreign institutions’ orders exceed their allocated shares before the deal roadshow.

LGES proposed a price band of between 257,000 won ($217.52) and 300,000 won to raise 10.9 trillion won to 12.8 trillion won in January. Of the total, 55% will be allocated to institutions, which can be increased to 75% if the portions for the employees association and retail investors are undersubscribed, which is highly unlikely.

LGES is the world’s second-largest electric vehicle battery maker, but foreign institutions believe it is practically the largest in the world. Its bigger Chinese rival Contemporary Amperex Technology (CATL) has grown on the back of strong government support, with a heavy reliance on Chinese finished carmakers. CATL has generated more than 80% of its revenue from the Chinese market, with Its major clients including BAIC, Yutong Bus, Geely, and SAIC Motor.

CATL held a 31.2% share in the global EV battery market as of the end of October, with battery usage of 67.5 GWh, according to SNE Research. LGES ranked second with a 21.2% market share and battery usage of 45.8 GWh. Panasonic placed third with 13.2% and China's BYD followed with 8.5%.

LGES’ customers include global automobile manufacturers such as General Motors, Tesla, Hyundai Motor, Volkswagen, BMW, Mercedes-Benz, Porsche, and Ford. The Asian market accounted for 45.1% of its revenue last year, followed by Europe with 42.2% and the U.S. with 12.7%.

The Korean battery maker plans to use the proceeds from the IPO for capital expenditure with a target to more than double its annual production capacity to 400 GWh by 2025 from 155 GWh in the third quarter of this year.

The battery maker’s market capitalization is expected to reach between 60.14 trillion won and 70.2 trillion won after the listing, which is only a quarter of its rival CATL’s 273 trillion won. (Reporting by Kyung-ju Lee)