Japan-based messaging app Line Corp saw second-quarter revenue jump by more than half, fuelled by growth outside its home market, in a boost to the service's plans for an initial public offering that could value the firm at up to $20 billion.

Line's parent, South Korea's leading online portal operator Naver Corp, said on Thursday the surge helped its own revenue grow as it posted earnings that beat market estimates. With higher game traffic from outside Japan and new user-created emoticons creating an extra sales stream, Line's rapid growth may push IPO value expectations even higher.

The messaging app, developed to overcome downed communications in Japan after the March 2011 earthquake and tsunami, is being closely watched by potential investors. Naver has not released any details about the planned listing, but it would be the first IPO by a major chat app.

On Thursday Naver denied a local newspaper report that Chinese e-commerce giant Alibaba Group Holding Ltd (IPO-BABA.N) and Japanese telecom and internet companySoftBank Corp were in talks to take a stake in Line.

Naver said earlier this month that Line was considering an IPO in Tokyo or New York, or both. Banking sources have said the listing will ultimately be either a dual U.S.-Japan listing, or a listing only in the United States.

A banking source previously told Reuters Line could be valued at $10 billion to $20 billion, and was likely to launch the IPO in October with a listing in November.

(source : newsonjapan.com)