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

Duzonbizon: Cloud-Based Software Providing an Edge Amidst COVID-19 Carnage

Duzonbizon - Time to Take Profits; Company Buying a Big Building Destroying Value

Digital Finance in Korea: New Laws Coming in 2020 & Credit Bureau Industry

Asian E-Wallets Plant Their Flags: An In-Depth Analysis of the Top-10 Players

Event-Driven

On 16 April after the market close, it was reported in several local<a href="https://n.news.naver.com/article/015/0004325713" target="_blank" rel="noopener"> media</a> reported that <a href="https://www.smartkarma.com/entities/ncsoft-corp" target="_blank" data-smartkarma-citation="entities:5169:1" rel="noopener">NCsoft Corp (036570 KS)</a> plans to buy a big piece of land in Pangyo, Korea, located about 30 minutes away from southeastern Seoul. The estimated value of this land (25,719㎡), which is currently owned by the local Pangyo government, is at least 800 billion won ($650 million). This land sale is expected to get completed by end of August.  We believe that this news about NCsoft planning to buy a big piece of land is likely to have a short-term negative impact on the company's share price. Most investors would rather prefer NCsoft to reinvest its cash on its core games business rather than build a posh, new building.It is clear that this investment in this very large piece of land will not improve the company's returns on capital. NCsoft generated an ROE of 15% in 2019 and this is expected to rise to nearly 29% in 2020. The investment in this large piece of land will likely shrink its ROE in the next two years.

On 16 April after the market close, it was reported in several local media reported that NCsoft Corp (036570 KS) plans to buy a big piece of land in Pangyo, Korea, located about 30 minutes away from southeastern Seoul. The estimated value of this land (25,719㎡), which is currently owned by the local Pangyo government, is at least 800 billion won ($650 million). This land sale is expected to get completed by end of August.  We believe that this news about NCsoft planning to buy a big piece of land is likely to have a short-term negative impact on the company's share price. Most investors would rather prefer NCsoft to reinvest its cash on its core games business rather than build a posh, new building.It is clear that this investment in this very large piece of land will not improve the company's returns on capital. NCsoft generated an ROE of 15% in 2019 and this is expected to rise to nearly 29% in 2020. The investment in this large piece of land will likely shrink its ROE in the next two years.

NCsoft Plans to Buy a Big Piece of Land in Pangyo - A Short Term Negative

NCSOFT Corp

NCsoft Plans to Buy a Big Piece of Land in Pangyo - A Short Term Negative