Fnguide IPO Preview

FnGuide Inc (064850 KS) is getting ready to complete its IPO on December 17th on the KOSDAQ market in Korea. In this insight, we provide a detailed analysis of the company's business model. The IPO price has been finalized at 7,000 won, which is higher than the original IPO price range of 5,200 won to 6,500 won. A 1.6 million shares are being offered in this IPO (1.0 million new shares and 0.6 million shares from existing investors).

If we attach a 35x P/E multiple on this stock (closer to the valuation multiple of Wise Itech) on its annualized net profit of 3.9 billion won, this would result in an implied market cap of 136 billion won or implied price of 11,280 won. This would be 61% higher than the IPO price of 7,000 won. Therefore, we are positive on the share price performance of this stock when it starts trading.