IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/coupang" target="_blank" data-smartkarma-citation="entities:28425:1" rel="noopener">Coupang (CPNG US)</a> is the largest e-commerce platform in South Korea, according to Euromonitor. Coupang is best known for Rocket Delivery, which provides free, next-day delivery for orders placed any time of the day.</p></div><div><p>Coupang has increased its IPO price range from $27-30 per share to $32-34 per share. The number of the offer shares remains unchanged at 120 million shares and the primary/secondary split remains unchanged. At the upsized IPO price range of $32-34 per share, Coupang will have a market cap of $55-58 billion vs the previous market cap of $46-51 billion. At the mid-point of the IPO price range, the net proceeds from the primary raise are $3.2 billion ($2.8 billion previously). </p></div><div>
<p>In <a href="https://www.smartkarma.com/insights/coupang-ipo-initiation-delivering-the-goods" target="_blank" data-smartkarma-citation="insights:48125" rel="noopener">Coupang IPO Initiation: Delivering the Goods</a>, we opined that Coupang's fundamentals tick all the right boxes and worth a look, in our view. In <a href="https://www.smartkarma.com/insights/coupang-ipo-valuation-insights" target="_blank" data-smartkarma-citation="insights:48708" rel="noopener">Coupang IPO: Valuation Insights</a> we noted was attractively priced for its growth potential vs global e-commerce peers at the original IPO price range.</p>
<div class="content-highlight"><p>Our valuation analysis suggests that Coupang remains attractive at the upsized IPO price range of $32-34 per share. Our base-case DCF valuation is $39.35 per share and we would participate in the IPO.</p></div>
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Coupang (CPNG US) is the largest e-commerce platform in South Korea, according to Euromonitor. Coupang is best known for Rocket Delivery, which provides free, next-day delivery for orders placed any time of the day.Coupang has increased its IPO price range from $27-30 per share to $32-34 per share. The number of the offer shares remains unchanged at 120 million shares and the primary/secondary split remains unchanged. At the upsized IPO price range of $32-34 per share, Coupang will have a market cap of $55-58 billion vs the previous market cap of $46-51 billion. At the mid-point of the IPO price range, the net proceeds from the primary raise are $3.2 billion ($2.8 billion previously). 
In Coupang IPO Initiation: Delivering the Goods, we opined that Coupang's fundamentals tick all the right boxes and worth a look, in our view. In Coupang IPO: Valuation Insights we noted was attractively priced for its growth potential vs global e-commerce peers at the original IPO price range.
Our valuation analysis suggests that Coupang remains attractive at the upsized IPO price range of $32-34 per share. Our base-case DCF valuation is $39.35 per share and we would participate in the IPO.


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<p><a href="https://www.smartkarma.com/entities/coupang" target="_blank" data-smartkarma-citation="entities:28425:1" rel="noopener">Coupang (CPNG US)</a> is the largest e-commerce platform in South Korea, according to Euromonitor. Coupang is best known for Rocket Delivery, which provides free, next-day delivery for orders placed any time of the day.</p>
<p>At the proposed IPO price range of $27-30 per share, Coupang will have a market cap of $46-51 billion. The IPO which comprises of a primary and secondary offering will raise total gross proceeds up to $3.6 billion.  At the mid-point of the IPO price range, the net proceeds from the primary raise are $2.8 million. </p>
</div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/coupang-ipo-initiation-delivering-the-goods" target="_blank" data-smartkarma-citation="insights:48125" rel="noopener">Coupang IPO Initiation: Delivering the Goods</a>, we opined that Coupang's fundamentals tick all the right boxes and worth a look, in our view. Coupang is a new-economy growth story and at the IPO price range, is attractively priced for its growth potential vs global e-commerce peers. Consequently, we would participate in the IPO. </p></div></div></div>


Coupang (CPNG US) is the largest e-commerce platform in South Korea, according to Euromonitor. Coupang is best known for Rocket Delivery, which provides free, next-day delivery for orders placed any time of the day.
At the proposed IPO price range of $27-30 per share, Coupang will have a market cap of $46-51 billion. The IPO which comprises of a primary and secondary offering will raise total gross proceeds up to $3.6 billion.  At the mid-point of the IPO price range, the net proceeds from the primary raise are $2.8 million. 
In Coupang IPO Initiation: Delivering the Goods, we opined that Coupang's fundamentals tick all the right boxes and worth a look, in our view. Coupang is a new-economy growth story and at the IPO price range, is attractively priced for its growth potential vs global e-commerce peers. Consequently, we would participate in the IPO. 

<div><p><a href="https://www.smartkarma.com/entities/coupang" target="_blank" data-smartkarma-citation="entities:28425:1" rel="noopener">Coupang (CPNG US)</a> is the largest e-commerce platform in South Korea, according to Euromonitor. Coupang is best known for Rocket Delivery, which provides free, next-day delivery for orders placed any time of the day.</p></div><div><p>Coupang is seeking to raise up to $2 billion at a $50 billion valuation, according to Reuters. The rumoured valuation is a significant increase to the December 2018 fundraising at a $9 billion valuation, according to press reports. </p></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/coupang-ipo-initiation-delivering-the-goods" target="_blank" data-smartkarma-citation="insights:48125" rel="noopener">Coupang IPO Initiation: Delivering the Goods</a>, we opined that Coupang's fundamentals tick all the right boxes and worth a look, in our view. In this note, we take a first look at Coupang's valuation. Overall, based on our valuation analysis, we think that the rumoured IPO valuation can be justified.</p></div></div></div>

Coupang (CPNG US) is the largest e-commerce platform in South Korea, according to Euromonitor. Coupang is best known for Rocket Delivery, which provides free, next-day delivery for orders placed any time of the day.Coupang is seeking to raise up to $2 billion at a $50 billion valuation, according to Reuters. The rumoured valuation is a significant increase to the December 2018 fundraising at a $9 billion valuation, according to press reports. In Coupang IPO Initiation: Delivering the Goods, we opined that Coupang's fundamentals tick all the right boxes and worth a look, in our view. In this note, we take a first look at Coupang's valuation. Overall, based on our valuation analysis, we think that the rumoured IPO valuation can be justified.

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

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<p><strong>Our base case valuation of Wish is an implied EV of $12.3 billion, implied market cap of $14.4 billion, and implied price per share of $24.50 per share. This represents just a 2% upside to the high end of the IPO price range of $24 per share. Given such a low upside, we would pass on this IPO.</strong></p>
<p><strong>One of the long-term concerns we have about Wish is the fact that the number one priority of the company is price. This is a double-edged sword.</strong> By focusing on price as the number one priority, the company has been able to gain a tremendous number of customers that put price as their number one importance. Nonetheless, it may be difficult for the company to generate relatively high profit margins in the long run since Wish may have difficulties in gaining customers that value quality over price when purchasing products through mobile or online platforms.</p>
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Our base case valuation of Wish is an implied EV of $12.3 billion, implied market cap of $14.4 billion, and implied price per share of $24.50 per share. This represents just a 2% upside to the high end of the IPO price range of $24 per share. Given such a low upside, we would pass on this IPO.
One of the long-term concerns we have about Wish is the fact that the number one priority of the company is price. This is a double-edged sword. By focusing on price as the number one priority, the company has been able to gain a tremendous number of customers that put price as their number one importance. Nonetheless, it may be difficult for the company to generate relatively high profit margins in the long run since Wish may have difficulties in gaining customers that value quality over price when purchasing products through mobile or online platforms.


Wish IPO Valuation Analysis: Focus on Price Is a Double-Edged Sword

<p>Wish is getting ready to complete its IPO in the U.S. by the end of this year. Wish is among the four major U.S. tech related IPOs, including Airbnb, DoorDash, and Roblox that are trying to complete their IPOs by the end of this year. All four of these IPOs are outstanding companies with superior business models. DoorDash and Airbnb are seeking $30 billion or more in valuation. Wish is seeking valuation in the $25 billion to $30 billion or more, and Roblox's IPO could fetch at least $10 billion to $15 billion or more. In other words, the U.S. tech IPO market is likely to end with a Bang rather than a Whimper. Wish has put an IPO placeholder at $1 billion but this figure is likely to be revised up materially.</p><p><strong>Wish is an e-commerce platform founded by an ex-Google engineer Piotr Szulczewski (CEO) and Danny Zhang (former CTO).</strong> These two founders are college buddies from the University of Waterloo.<a href="https://www.forbes.com/sites/parmyolson/2019/03/13/meet-the-billionaire-who-defied-amazon-and-built-wish-the-worlds-most-downloaded-e-commerce-app/" target="_blank" rel="noopener"> Szulczewski</a> was 11 years old when his parents immigrated to Canada from Poland when the Soviet Union collapsed. Early on his career, the founder Piotr Szulczewski worked at Google for about a decade, including spending some time in South Korea. Szulczewski left Google in 2009 and formed Wish a year later. Back in 2016, Amazon gave an interest to acquire Wish (amount unspecified) but Szulczewski turned it down. Good for him since he is now worth a lot more than if he had taken that offer.</p><p>Wish's is focused on serving customers whose number one priority is price.</p>

Wish is getting ready to complete its IPO in the U.S. by the end of this year. Wish is among the four major U.S. tech related IPOs, including Airbnb, DoorDash, and Roblox that are trying to complete their IPOs by the end of this year. All four of these IPOs are outstanding companies with superior business models. DoorDash and Airbnb are seeking $30 billion or more in valuation. Wish is seeking valuation in the $25 billion to $30 billion or more, and Roblox's IPO could fetch at least $10 billion to $15 billion or more. In other words, the U.S. tech IPO market is likely to end with a Bang rather than a Whimper. Wish has put an IPO placeholder at $1 billion but this figure is likely to be revised up materially.Wish is an e-commerce platform founded by an ex-Google engineer Piotr Szulczewski (CEO) and Danny Zhang (former CTO). These two founders are college buddies from the University of Waterloo. Szulczewski was 11 years old when his parents immigrated to Canada from Poland when the Soviet Union collapsed. Early on his career, the founder Piotr Szulczewski worked at Google for about a decade, including spending some time in South Korea. Szulczewski left Google in 2009 and formed Wish a year later. Back in 2016, Amazon gave an interest to acquire Wish (amount unspecified) but Szulczewski turned it down. Good for him since he is now worth a lot more than if he had taken that offer.Wish's is focused on serving customers whose number one priority is price.

United States

ContextLogic Inc., doing business as Wish, operates as an online marketplace. The Company provides apparel, bags, toys, mobile phones and covers, hand and power tools, cosmetics, drinking games, home decor, bathroom fixtures, building supplies, and other accessories. Wish serves customers worldwide.

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ContextLogic (LOGC US)

Coupang IPO: Upsized Deal Size

Coupang has increased its IPO price range from $27-30 per share to $32-34 per share. Our base-case DCF valuation is $39.35 per share and we would...

Arun George

Coupang IPO: Valuation Insights

The $27-30 price range implies gross proceeds up to $3.6 billion and values Coupang at $46-51 billion. At the price range, Coupang is attractively...

Arun George

Coupang IPO: Valuation First Look

Coupang is seeking a $50 billion valuation, according to Reuters. Overall, based on our valuation analysis, we think that the rumoured IPO...

Arun George

Wish IPO Valuation Analysis: Focus on Price Is a Double-Edged Sword

Our base case valuation of Wish is an implied price per share of $24.50 per share. This represents just a 2% upside to the high end of the IPO...

Douglas Kim

Wish IPO Preview

Wish has become the most downloaded global shopping app for each of the last three years. Wish is one of the most highly anticipated IPOs in the...

Douglas Kim

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