Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<ul>
<li>Oasis Corp is getting ready to complete its IPO on KOSDAQ in February 2023. Oasis Corp is a leading online/offline provider of organic foods and other groceries in Korea.</li>
<li>IPO price range is from 30,500 won to 39,500 won, with a total offering amount of 160 billion won to 207 billion won. </li>
<li>Other than Coupang, the other three companies (bankers' valuation) may not be appropriate comps, mainly because they operate in different markets around the world and are much bigger in size.</li>
</ul>


Oasis Corp is getting ready to complete its IPO on KOSDAQ in February 2023. Oasis Corp is a leading online/offline provider of organic foods and other groceries in Korea.
IPO price range is from 30,500 won to 39,500 won, with a total offering amount of 160 billion won to 207 billion won. 
Other than Coupang, the other three companies (bankers' valuation) may not be appropriate comps, mainly because they operate in different markets around the world and are much bigger in size.


Equity Bottom-Up

<ul>
<li>In this insight, we discuss an update of pair trade between Emart (long) and Coupang (short). </li>
<li>Back on 1 August 2022, we recommended a pair trade between E Mart Inc (139480 KS) (long) and Coupang (CPNG US) (short).</li>
<li>This pair trade has worked well in the past five months and we continue to like this pair trade (long Emart and short Coupang).</li>
</ul>


In this insight, we discuss an update of pair trade between Emart (long) and Coupang (short). 
Back on 1 August 2022, we recommended a pair trade between E Mart Inc (139480 KS) (long) and Coupang (CPNG US) (short).
This pair trade has worked well in the past five months and we continue to like this pair trade (long Emart and short Coupang).


An Update to Our Pair Trade Between Emart & Coupang

<ul>
<li>Lotte Shopping is a deep value stock poised for a turnaround. </li>
<li>Lotte Shopping has clear turnaround catalysts, cheap valuations, and a solid technical setup. </li>
<li>Perhaps the most important catalysts for Lotte Shopping include getting rid of the most restrictions/social distancing measures related to COVID-19 which have been in place in the past three years.</li>
</ul>


Lotte Shopping is a deep value stock poised for a turnaround. 
Lotte Shopping has clear turnaround catalysts, cheap valuations, and a solid technical setup. 
Perhaps the most important catalysts for Lotte Shopping include getting rid of the most restrictions/social distancing measures related to COVID-19 which have been in place in the past three years.


Lotte Shopping: A Deep Value Stock Poised for a Turnaround

Telco/Internet specialist

Kirk Boodry

Redex Research

<ul>
<li>Alibaba is up 20% QTD and the public Vision Fund portfolio is on track for its first positive quarter in almost two years thanks to China upside, mostly for Didi</li>
<li>That has kept the share price elevated even as the discount to fair value has expanded since buybacks ended at Q2 results</li>
<li>At 34% now, there is room for the discount to expand further as the range before the buyback surge was generally closer to 40%</li>
</ul>


Alibaba is up 20% QTD and the public Vision Fund portfolio is on track for its first positive quarter in almost two years thanks to China upside, mostly for Didi
That has kept the share price elevated even as the discount to fair value has expanded since buybacks ended at Q2 results
At 34% now, there is room for the discount to expand further as the range before the buyback surge was generally closer to 40%


Softbank Group - China Rebound Has Helped After End-Of-Buyback Hangover

Equity Analyst, LightStream Research

Oshadhi Kumarasiri

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<ul>
<li>South Korea’s largest e-commerce company, <a href="https://www.smartkarma.com/entities/coupang-inc" target="_blank" data-smartkarma-citation="entities:28425:1" rel="noopener">Coupang (CPNG US)</a> is no longer a growth stock with revenue expected to start falling on a YoY basis from 4Q22 onwards.</li>
<li>Therefore, we think Coupang’s current valuation, which is based on inflated revenue estimates should become redundant.</li>
<li>We think a no-growth, low-margin business like Coupang does not deserve to trade north of 10.0x OP, whereas it is currently trading at 15.6x the best-case OP estimate.</li>
</ul>


South Korea’s largest e-commerce company, Coupang (CPNG US) is no longer a growth stock with revenue expected to start falling on a YoY basis from 4Q22 onwards.
Therefore, we think Coupang’s current valuation, which is based on inflated revenue estimates should become redundant.
We think a no-growth, low-margin business like Coupang does not deserve to trade north of 10.0x OP, whereas it is currently trading at 15.6x the best-case OP estimate.


Coupang: Time Ditch EV/Sales and Focus on Profitability-Based Multiples

South Korea

Coupang, Inc. operates as an e-commerce company. The Company offers dynamic end-to-end e-commerce and logistic solutions. Coupang serves customers worldwide.

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Coupang (CPNG US)

Oasis Corp IPO Preview

Oasis Corp is getting ready to complete its IPO on KOSDAQ in February 2023. Oasis Corp is a leading online/offline provider of organic foods and...

Douglas Kim

An Update to Our Pair Trade Between Emart & Coupang

We discuss an update of pair trade between Emart (long) and Coupang (short). Emart is a value stock with its shares trading at 0.2x P/B (2023)....

Douglas Kim

Lotte Shopping: A Deep Value Stock Poised for a Turnaround

Lotte Shopping is a deep value stock in Korea with key catalysts for a turnaround in 2023. Lotte Shopping currently has a market cap of 2.5...

Douglas Kim

Softbank Group - China Rebound Has Helped After End-Of-Buyback Hangover

A China re-rating has boosted the value of Alibaba and could help Vision Fund deliver its first positive quarter in almost two years but the...

Kirk Boodry

Coupang: Time Ditch EV/Sales and Focus on Profitability-Based Multiples

We think a no-growth, low-margin business like Coupang does not deserve to trade north of 10.0x OP, whereas it is currently trading at 15.6x the...

Oshadhi Kumarasiri

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