Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Nearly 30 years of experience in the Korean/Asian equity research. Major sectors coverage include the following:
- Technology 
- Consumer 
- Special Situations/Deep Value Plays
- Tender Offers/M&As
- Holdcos/Stubs
- Asian Unicorns/Private Companies

Korea/Asia, Events, IPOs

Saltlux IPO Preview: A Legit Player in the AI/Big Data Sector in Korea

Equity Bottom-Up

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Flitto is a leading AI-driven big data and translation services provider in Korea. It completed its IPO in the Korean stock market on July 17th. The current price of Flitto is 22,000 won, which is 15% below the IPO price of 26,000 won.
We believe that Flitto has an outstanding, long-term promising potential with a deep, competitive moat. Therefore, we are including Flitto in our model portfolio.  We also believe that this is an attractive take-out candidate by Naver, Kakao, and even tech giants such as Google. 
</div>We believe Flitto will be a very attractive stock over the next one to three years. Although forecasting a company such as Flitto which is experiencing an explosive growth in sales is difficult, if we make an assumption of the company's sales growing 73.3% CAGR from 2019 to 2024, this would suggest sales of 93 billion won. If we also assume a 20% operating margin in 2024, this would represent an operating profit of 18.6 billion won in 2024. If we assume a P/S multiple of 4x using our estimated sales of 93 billion won in 2024, this would suggest an implied market cap of 372 billion won. Taking the present value using a 15% annual discount rate suggests the current value of 185 billion won (35,700 won per share), which is 61% higher than the current market cap.


Flitto is a leading AI-driven big data and translation services provider in Korea. It completed its IPO in the Korean stock market on July 17th. The current price of Flitto is 22,000 won, which is 15% below the IPO price of 26,000 won.
We believe that Flitto has an outstanding, long-term promising potential with a deep, competitive moat. Therefore, we are including Flitto in our model portfolio.  We also believe that this is an attractive take-out candidate by Naver, Kakao, and even tech giants such as Google. 
We believe Flitto will be a very attractive stock over the next one to three years. Although forecasting a company such as Flitto which is experiencing an explosive growth in sales is difficult, if we make an assumption of the company's sales growing 73.3% CAGR from 2019 to 2024, this would suggest sales of 93 billion won. If we also assume a 20% operating margin in 2024, this would represent an operating profit of 18.6 billion won in 2024. If we assume a P/S multiple of 4x using our estimated sales of 93 billion won in 2024, this would suggest an implied market cap of 372 billion won. Taking the present value using a 15% annual discount rate suggests the current value of 185 billion won (35,700 won per share), which is 61% higher than the current market cap.

Flitto: AI-Driven, Big Data Langugage & Translation Services

Flitto Inc.

Flitto: AI-Driven, Big Data Langugage & Translation Services