Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<div class="content-highlight"><p><strong>Our base case valuation of HK Inno.N is EV of 2.6 trillion won and implied market cap of 2.2 trillion won (75,534 won per share). This is based on 24x EV/EBIT using our 2022 EBIT estimate of 108.8 billion won.</strong> Our base case valuation of 75,534 won per share represents a 28% upside from the high end of the IPO price range of 59,000 won. Given the solid upside, we have a Positive Rating of the HK Inno.N IPO. </p></div><p>HK inno.N mainly provides prescription drugs and H&amp;B (health &amp; beauty) products. About 86% of its sales were derived from the prescription drug segment and the remaining 14% from the Health Beauty &amp; Beverage (HB &amp; B) segment in 2020.</p>

Our base case valuation of HK Inno.N is EV of 2.6 trillion won and implied market cap of 2.2 trillion won (75,534 won per share). This is based on 24x EV/EBIT using our 2022 EBIT estimate of 108.8 billion won. Our base case valuation of 75,534 won per share represents a 28% upside from the high end of the IPO price range of 59,000 won. Given the solid upside, we have a Positive Rating of the HK Inno.N IPO. HK inno.N mainly provides prescription drugs and H&amp;B (health &amp; beauty) products. About 86% of its sales were derived from the prescription drug segment and the remaining 14% from the Health Beauty &amp; Beverage (HB &amp; B) segment in 2020.

<p>HK Inno.N ("Inno.N") is getting ready for an IPO in the Korean stock market. The IPO price range is from 50,000 won to 59,000 won. The company is offering 10.1 million shares in this IPO including 5.8 million new shares and 4.3 million old shares. The IPO deal size is from $447 million to $527 million.</p><p>According to the bankers' valuation, the expected market cap after the IPOs is from 1.4 trillion won ($1.2 billion) to 1.7 trillion won ($1.5 billion). The book building for the institutional investors starts on 22 July 2021. Korea Investment &amp; Securites and Samsung Securities are the lead underwriters of this IPO. </p><p><a href="https://www.smartkarma.com/entities/korea-kolmar-co-ltd" target="_blank" data-smartkarma-citation="entities:7985:1" rel="noopener">Korea Kolmar (161890 KS)</a> is the controlling shareholder of <a href="https://www.hkn24.com/news/articleView.html?idxno=319760" target="_blank" rel="noopener">HK Inno.N</a> with a 52.7% stake in the company. </p><p>HK Inno.N IPO will be on KOSDAQ. At the high end of the IPO price range, this would be valued at 1.7 trillion won. Currently, there are 23 stocks that have more than 1.7 trillion won in market cap on KOSDAQ. </p><table class="table table-striped">
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<td style="width: 248pt;"><div><strong>Deal Specifics of the HK Inno.N IPO:</strong></div></td>
<td style="width: 310pt;"> </td>
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<td>Lead underwriters of the IPO: </td>
<td style="width: 310pt;">Korea Investment &amp; Securities, Samsung Securities</td>
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<td>Expected IPO price per share: </td>
<td style="width: 310pt;">50,000 won (low)/59,000 won (high)</td>
</tr>
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<td>Number of Shares for IPO:</td>
<td style="width: 310pt;">10.1m shares (5.8m new shares and 4.3m old shares)</td>
</tr>
<tr>
<td>IPO base deal size: </td>
<td style="width: 310pt;">US$447 mn (low);  US$527 mn (high)</td>
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<td>Expected common shares outstanding, fully diluted (post-IPO):  </td>
<td style="width: 310pt;">28.9m shares</td>
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<td>Expected market cap after IPO:</td>
<td style="width: 310pt;">1,445 billion won (low)/1,705 billion won (high)</td>
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<td>Book open: </td>
<td style="text-align: left; width: 310pt;">22-Jul-21</td>
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<td>Book closed:</td>
<td style="text-align: left; width: 310pt;">26-Jul-21</td>
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<td>Listing date: </td>
<td style="text-align: left; width: 310pt;">TBC</td>
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<td>Source: Company data</td>
<td style="width: 310pt;"> </td>
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HK Inno.N ("Inno.N") is getting ready for an IPO in the Korean stock market. The IPO price range is from 50,000 won to 59,000 won. The company is offering 10.1 million shares in this IPO including 5.8 million new shares and 4.3 million old shares. The IPO deal size is from $447 million to $527 million.According to the bankers' valuation, the expected market cap after the IPOs is from 1.4 trillion won ($1.2 billion) to 1.7 trillion won ($1.5 billion). The book building for the institutional investors starts on 22 July 2021. Korea Investment &amp; Securites and Samsung Securities are the lead underwriters of this IPO. Korea Kolmar (161890 KS) is the controlling shareholder of HK Inno.N with a 52.7% stake in the company. HK Inno.N IPO will be on KOSDAQ. At the high end of the IPO price range, this would be valued at 1.7 trillion won. Currently, there are 23 stocks that have more than 1.7 trillion won in market cap on KOSDAQ. 






Deal Specifics of the HK Inno.N IPO:
 


Lead underwriters of the IPO: 
Korea Investment &amp; Securities, Samsung Securities


Expected IPO price per share: 
50,000 won (low)/59,000 won (high)


Number of Shares for IPO:
10.1m shares (5.8m new shares and 4.3m old shares)


IPO base deal size: 
US$447 mn (low);  US$527 mn (high)


Expected common shares outstanding, fully diluted (post-IPO):  
28.9m shares


Expected market cap after IPO:
1,445 billion won (low)/1,705 billion won (high)


Book open: 
22-Jul-21


Book closed:
26-Jul-21


Listing date: 
TBC


Source: Company data
 




South Korea

HK inno.N Corp. develops and manufactures pharmaceuticals products. The Company develops and sells immune anticancer drugs, blood disease drugs, kidney disease drugs, and other products. HK inno.N conducts businesses across worldwide.

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HK inno.N (195940 KS)

HK Inno.N IPO Valuation Analysis

Our base case valuation of HK Inno.N is 75,534 won per share, which represents a 28% upside from the high end of the IPO price range. We have a...

Douglas Kim

HK Inno.N IPO Preview

HK Inno.N is getting ready for an IPO in the Korean stock market. The IPO price range is from 50,000 won to 59,000 won. The IPO deal size is from...

Douglas Kim

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