Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<ul><li><a href="https://www.smartkarma.com/entities/23572" target="_blank" data-smartkarma-citation="entities:23572:1">Yellomobile Inc (1243811D KS)</a> is one of the fastest growing and the biggest consolidator of mobile business platforms in Korea. The company was preparing for an IPO last year. Now, the company is preparing for IPOs of its affiliated companies first in 2H 2016. We think that the Yello Mobile itself is likely to complete an IPO sometime in 2017/2018. Yello Mobile is turning itself into an operating holding company. By end of this year, Yello Mobile plans to merge with Yello Shopping Media, a mobile shopping portal operator which the company owns a 100% stake.</li><li>Yello Mobile announced that it is planning IPO of its two affiliated companies first including Future Stream Network and Yello O2O in 2H 2016. Future Stream Networks (also known as Cauly) is one of the most widely used mobile ad networks in Korea.  </li><li>There are two major unicorns in Korea: one is Coupang, the other is Yello Mobile. Yello Mobile was valued at US$4 billion in its most recent private market valuation, which would place the company in the second place behind Coupang in terms of highest private market funding among IT companies in Korea. </li><li>One of the major advantages of Yello Mobile has been its highly aggressive, fast pace acquisition mode to outbid on promising startup app companies in Korea. The M&amp;A market for Korea's venture/IT startups is much smaller than the developed US/Silicon Valley market and this is often a buyers market. The chaebols in Korea often move at snail's pace and the capital markets are not as well developed in terms of investing in venture/IT startups, despite many promising startup companies.  </li></ul><ul><li>The company has five major app categories: 1) Shopping, 2) Media, 3) AdTech, 4) Travel, and 5)O2O (Offline to Online). It also has a separate Yello Financial Group business, which invests in financial technology companies. Some of the better known branded companies within YelloMobile include CooCha (mobile commerce), Pikicast (mobile curating app), RecoBell (provides personalized recommendations for mobile consumers using big data), Alammon (a morning call service), 1km (a social dating application), and Emotion (a web agency).</li><li>The company has experienced an explosive sales growth, from 9 billion won in 2013 to 318.2 billion won in 2015. It generated 227.1 billion won in sales in 1H16, up 67.6% YoY. The company expects to generate about 500 billion won in sales in 2016, up 57% YoY. What's impressive about the company's financials is not just the explosive sales growth, but also the decline in its operating losses. For example, its operating losses declined to 5.7 billion won in 1H16, down from 41.3 billion won in 1H15. This is a testament of the company's increasing economies of scale.</li></ul>

Yellomobile Inc (1243811D KS) is one of the fastest growing and the biggest consolidator of mobile business platforms in Korea. The company was preparing for an IPO last year. Now, the company is preparing for IPOs of its affiliated companies first in 2H 2016. We think that the Yello Mobile itself is likely to complete an IPO sometime in 2017/2018. Yello Mobile is turning itself into an operating holding company. By end of this year, Yello Mobile plans to merge with Yello Shopping Media, a mobile shopping portal operator which the company owns a 100% stake.Yello Mobile announced that it is planning IPO of its two affiliated companies first including Future Stream Network and Yello O2O in 2H 2016. Future Stream Networks (also known as Cauly) is one of the most widely used mobile ad networks in Korea.  There are two major unicorns in Korea: one is Coupang, the other is Yello Mobile. Yello Mobile was valued at US$4 billion in its most recent private market valuation, which would place the company in the second place behind Coupang in terms of highest private market funding among IT companies in Korea. One of the major advantages of Yello Mobile has been its highly aggressive, fast pace acquisition mode to outbid on promising startup app companies in Korea. The M&amp;A market for Korea's venture/IT startups is much smaller than the developed US/Silicon Valley market and this is often a buyers market. The chaebols in Korea often move at snail's pace and the capital markets are not as well developed in terms of investing in venture/IT startups, despite many promising startup companies.  The company has five major app categories: 1) Shopping, 2) Media, 3) AdTech, 4) Travel, and 5)O2O (Offline to Online). It also has a separate Yello Financial Group business, which invests in financial technology companies. Some of the better known branded companies within YelloMobile include CooCha (mobile commerce), Pikicast (mobile curating app), RecoBell (provides personalized recommendations for mobile consumers using big data), Alammon (a morning call service), 1km (a social dating application), and Emotion (a web agency).The company has experienced an explosive sales growth, from 9 billion won in 2013 to 318.2 billion won in 2015. It generated 227.1 billion won in sales in 1H16, up 67.6% YoY. The company expects to generate about 500 billion won in sales in 2016, up 57% YoY. What's impressive about the company's financials is not just the explosive sales growth, but also the decline in its operating losses. For example, its operating losses declined to 5.7 billion won in 1H16, down from 41.3 billion won in 1H15. This is a testament of the company's increasing economies of scale.

Yello Mobile IPO Preview: Part I (A Unicorn Consolidator of Mobile Apps in Korea)

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AutoNation, Inc. retails, finances, and services new and used vehicles.  The Company also provides other related services and products, such as the sale of parts and accessories, extended service contracts, aftermarket automotive products, and collision repair services.  AutoNation operates throughout the United States.

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Yello Mobile IPO Preview: Part I (A Unicorn Consolidator of Mobile Apps in Korea)

Yellomobile Inc (1243811D KS) is one of the fastest growing and the biggest consolidator of mobile business platforms in Korea. The company was...

Douglas Kim

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