Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

Dreamtech Co Ltd / Equity Capital Markets

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<strong><a href="https://www.smartkarma.com/entities/27531" target="_blank" data-smartkarma-citation="entities:27531:1">Dreamtech Co Ltd (192650 KS)</a></strong> is an IPO in Korea which is expected to be completed in November 2018. Established in 1988, <strong>Dreamtech makes modules and sensors for smartphones, auto vehicles, home appliances, and health care products.</strong> The IPO price range is between 13,400 won to 16,700 won. The company is expected to raise between US$76 million to US$94 million in this IPO.</li>
<li>The bankers used 20 companies including SEMCO, SimmTech, and Rayence as comparable companies to Dreamtech. This is a bit unusual since the bankers typically use only about three to six companies as comparables. The average P/E of the comps is 19.3x (based on the annualized net profit in 1H18). The bankers then took the annualized net profit of Dreamtech in 1H18 and applied this P/E multiple which resulted in an implied market cap of 657.9 billion won or implied price of 20,032 won. After applying additional 16.6% to 33.1% IPO discount, this resulted in the IPO price range of 13,400 won to 16,700 won.</li>
<li>The company has a record of sporadic sales and profits growth in the past several years. For example, the company's sales declined 22.5% YoY in 2015 but increased strongly in 2016 and 2017. Its sales declined slightly by 2.5% YoY in 1H18. </li>
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Dreamtech Co Ltd (192650 KS) is an IPO in Korea which is expected to be completed in November 2018. Established in 1988, Dreamtech makes modules and sensors for smartphones, auto vehicles, home appliances, and health care products. The IPO price range is between 13,400 won to 16,700 won. The company is expected to raise between US$76 million to US$94 million in this IPO.
The bankers used 20 companies including SEMCO, SimmTech, and Rayence as comparable companies to Dreamtech. This is a bit unusual since the bankers typically use only about three to six companies as comparables. The average P/E of the comps is 19.3x (based on the annualized net profit in 1H18). The bankers then took the annualized net profit of Dreamtech in 1H18 and applied this P/E multiple which resulted in an implied market cap of 657.9 billion won or implied price of 20,032 won. After applying additional 16.6% to 33.1% IPO discount, this resulted in the IPO price range of 13,400 won to 16,700 won.
The company has a record of sporadic sales and profits growth in the past several years. For example, the company's sales declined 22.5% YoY in 2015 but increased strongly in 2016 and 2017. Its sales declined slightly by 2.5% YoY in 1H18. 


South Korea

Dreamtech Co., Ltd. manufactures and distributes phone parts. The Company develops and sells smart phone fingerprint modules, smart phone side modules, and other related products. Dreamtech also produces automotive light emitting diode, sensors, home appliance essential modules, and other products.

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Dreamtech Co Ltd (192650 KS)

Dreamtech IPO Preview (Part 1)

Dreamtech Co Ltd (192650 KS) is an IPO in Korea which is expected to be completed in November 2018. Established in 1988, Dreamtech makes modules...

Douglas Kim

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