Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<p><strong>Our base case valuation of Coocon is 66,104 won, which is 65% higher than the high end of the IPO price range of 40,000 won.</strong> Our base case valuation also suggests an EV of 494 billion won and implied market cap of 549 billion won. Our base case valuation suggests an EV/EBIT (2020) multiple of 43.7x, which represents a 40% premium to Webcash and 67% higher than the average of Settlebank and Webcash valuation multiples in 2020. We have a positive view of Coocon IPO, given that our base case valuation is much higher than the high end of the IPO valuation range. </p><p>Coocon has superior financials than its comps including sales growth, operating margin, operating profit growth, and ROE. The combination of the superior financial metrics for Coocon versus its comps suggest that Coocon should trade at higher valuation multiples than its peers. The comps had an average EV/EBIT of 26.2x in 2020. </p>

Our base case valuation of Coocon is 66,104 won, which is 65% higher than the high end of the IPO price range of 40,000 won. Our base case valuation also suggests an EV of 494 billion won and implied market cap of 549 billion won. Our base case valuation suggests an EV/EBIT (2020) multiple of 43.7x, which represents a 40% premium to Webcash and 67% higher than the average of Settlebank and Webcash valuation multiples in 2020. We have a positive view of Coocon IPO, given that our base case valuation is much higher than the high end of the IPO valuation range. Coocon has superior financials than its comps including sales growth, operating margin, operating profit growth, and ROE. The combination of the superior financial metrics for Coocon versus its comps suggest that Coocon should trade at higher valuation multiples than its peers. The comps had an average EV/EBIT of 26.2x in 2020. 

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<li>
<a href="https://www.smartkarma.com/entities/coocon-corp" target="_blank" data-smartkarma-citation="entities:32234:1" rel="noopener">Coocon Corp (294570 KS)</a> is getting ready to complete its IPO in Korea in the next several weeks. The IPO price range is from 31,000 won to 40,000 won per share. The expected market cap range is from 257 billion won to 332 billion won. The IPO base deal size is from $44 million to $57 million. The book building for the institutional investors will start on 13 April 2021. </li>
<li>The company generated sales of 51.4 billion won (up 24.8% YoY), operating profit of 11.3 billion won (up 82.3% YoY), and net profit of 18.9 billion won (up 106.5% YoY) in 2020. Coocon has experienced a strong growth in sales in the past four years. From 2017 to 2020, the company's sales increased by 52% CAGR.</li>
<li><div class="content-highlight">There is likely to be a strong demand for the Coocon IPO shares, especially because the  IPO discount range is very large (32.4% to 47.6%). As the market leader in providing API based information services, Coocon is well positioned to capitalize on the growing demand of Big Data based API services in Korea.</div></li>
<li>Despite the strong fundamentals of the company, there has been some noticeable weakness on numerous tech related IPOs globally in the past 2-3 weeks and the overall growing negative sentiment on the global tech IPOs could also have a negative impact on this IPO as well. </li>
</ul>



Coocon Corp (294570 KS) is getting ready to complete its IPO in Korea in the next several weeks. The IPO price range is from 31,000 won to 40,000 won per share. The expected market cap range is from 257 billion won to 332 billion won. The IPO base deal size is from $44 million to $57 million. The book building for the institutional investors will start on 13 April 2021. 
The company generated sales of 51.4 billion won (up 24.8% YoY), operating profit of 11.3 billion won (up 82.3% YoY), and net profit of 18.9 billion won (up 106.5% YoY) in 2020. Coocon has experienced a strong growth in sales in the past four years. From 2017 to 2020, the company's sales increased by 52% CAGR.
There is likely to be a strong demand for the Coocon IPO shares, especially because the  IPO discount range is very large (32.4% to 47.6%). As the market leader in providing API based information services, Coocon is well positioned to capitalize on the growing demand of Big Data based API services in Korea.
Despite the strong fundamentals of the company, there has been some noticeable weakness on numerous tech related IPOs globally in the past 2-3 weeks and the overall growing negative sentiment on the global tech IPOs could also have a negative impact on this IPO as well. 


South Korea

Coocon Corporation operates as a business information provider. The Company provides business information collecting, connecting, and organizing services. Coocon offers services worldwide.

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Coocon Corp (294570 KS)

COOCON IPO Valuation Analysis

Our base case valuation of Coocon is 66,104 won, which is 65% higher than the high end of the IPO price range of 40,000 won.

Douglas Kim

COOCON IPO Preview

As the market leader in providing API based information services, Coocon is well positioned to capitalize on the growing demand of Big Data based...

Douglas Kim

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