In today’s briefing:
- OASIS IPO Pricing Is Not Even Worth Reviewing: Strongly Recommend Avoiding It
- Meritz Fire & Marine Insurance: Treasury Shares Cancellation of 5.9% of Outstanding Shares
- ETF Arbitrage in Korea: Names Suitable for Pair Trades
- Oasis Corporation IPO – Sole Profitable Player but Maybe Not for Long
OASIS IPO Pricing Is Not Even Worth Reviewing: Strongly Recommend Avoiding It
- Of the four peers, only Coupang adopts the gross method. Since the others adopt the net method, it is impossible to compare PSR with OASIS, which uses the gross method.
- If they really want to use PSR, it should only be compared with Coupang. Even if we apply CPNG’s current EV/Sales multiple (1.36x), it would only slightly exceed ₩0.5T.
- A more logical way would be to use EV/GMV. Even in this case, it wouldn’t be easy to expect a valuation higher than ₩0.5T.
Meritz Fire & Marine Insurance: Treasury Shares Cancellation of 5.9% of Outstanding Shares
- After the market close today, Meritz Fire & Marine Insurance announced that it will cancel 6.57 million treasury shares, representing 5.9% of its outstanding shares.
- This treasury shares cancellation by Meritz F&M Insurance should have a continued positive impact on its share price.
- Share cancellation by Meritz F&M Insurance and the need to adjust to higher merger ratio are likely to lead to Meritz F&M Insurance outperforming MFG in the next few days.
ETF Arbitrage in Korea: Names Suitable for Pair Trades
- As for the one using the creation/redemption mechanism, the tracking error (market value – NAV) is still too tight to call this an arbitrage opening.
- Then, at this point, we need to pay attention to ETF arbitrage from a pair trade perspective. There are a total of 3 pairs we can consider for this.
- The mean reversion cycle is still not short. However, the diversion range is not extensive, so we can aim for a relatively stable setup in a market with increased volatility.
Oasis Corporation IPO – Sole Profitable Player but Maybe Not for Long
- OASIS Corp (1799513D KS) is looking to raise up to US$166m in its upcoming Korea IPO.
- Oasis Corporation is an early morning delivery service business that delivers fresh food to consumers. It runs an e-commerce platform named ‘Oasis Market’ as well as offline stores.
- Oasis Corporation aims to boost its sales and presence by further improving on its omnichannel strategy. However, its explosive growth appears likely to have been driven by COVID-induced lockdown measures.
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