In today’s briefing:
- Korea – A Look at Ecopro, Kumyang & JYP Entertainment
- Fadu IPO – Thoughts on Valuation
- Korea Small Cap Gem #22: YMC (Beneficiary of China’s Restriction of Gallium Exports)
Korea – A Look at Ecopro, Kumyang & JYP Entertainment
- We take a look at Ecopro Co Ltd (086520 KS), Kum Yang (001570 KS) and Jyp Entertainment (035900 KS) since they appear to be on investor radars.
- Foreign investors have been buyers while retail have been sellers in Ecopro Co and Kum Yang over the last month, while foreign investors have continued to buy Jyp Entertainment.
- Short interest on all stocks has dropped over the last month, though there has been a recent tick up in shorts on Jyp Entertainment (035900 KS).
Fadu IPO – Thoughts on Valuation
- Fadu (440110 KS) is looking to raise up to US$147m in its Korean IPO.
- Fadu is a South Korean fabless semiconductor maker mainly engaged in flash storage technology innovation. Its core products are Enterprise Solid State Drive (SSD) and Enterprise SSDs.
- In our previous notes, we looked at the company’s past performance and undertook a peer comparison. In this note, we talk about valuation.
Korea Small Cap Gem #22: YMC (Beneficiary of China’s Restriction of Gallium Exports)
- On 3 July 2023, the Ministry of Commerce of China announced that it will restrict exports of gallium and germanium starting next month.
- YMC is one of the key beneficiaries in Korea of China’s restriction of gallium exports. YMC makes silicon carbide which can be a substitute material for gallium.
- YMC’s valuation is relatively cheap. Given that YMC currently has a market cap of 150 billion won, this would represent P/E of 7.3x (using 2022 net profit).
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