Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<ul><li>JTC is a duty-free shop focused company in Japan that is preparing for an IPO on the Korean stock market. JTC is planning to raise between US$61 million to US$75 million. Samsung Securities is the lead banker for this deal and the book building for the institutional investors starts on March 20th. </li><li>The bankers used <a href="https://www.smartkarma.com/entities/20987" target="_blank" data-smartkarma-citation="entities:20987:1">Shinsegae Co Ltd (004170 KS)</a>, <a href="https://www.smartkarma.com/entities/14818" target="_blank" data-smartkarma-citation="entities:14818:1">Modetour Network Inc (080160 KS)</a>, and <a href="https://www.smartkarma.com/entities/15874" target="_blank" data-smartkarma-citation="entities:15874:1">Very Good Leisure Co Ltd (094850 KS)</a> (also called Very Good Tour) as comparable companies to JTC. The average P/E of the three comps is 20.5x, which is based on their annualized 1Q-3Q17 net profit. The annualized net profit of JTC is 20.7 billion won and applying this multiple results in an implied price (pre-IPO discount) of 12,074 won. Applying the IPO discount of 37.1% to 48.7%, this results in the IPO range of 6,200 won to 7,600 won.<strong> </strong></li><li>On a consolidated basis, the company's sales increased 113.8% YoY to 626.7 billion won in FY15 (lasting from March 2015 to February 2016). Most of its sales (98% of total) are from duty-free shops and the remaining sales are from real estate rents and others. Its operating profit also increased 190.3% YoY to 90 billion won in FY15. JTC's operating margin increased from 10.6% in FY14 to 14.4% in FY15. </li></ul>

JTC is a duty-free shop focused company in Japan that is preparing for an IPO on the Korean stock market. JTC is planning to raise between US$61 million to US$75 million. Samsung Securities is the lead banker for this deal and the book building for the institutional investors starts on March 20th. The bankers used Shinsegae Co Ltd (004170 KS), Modetour Network Inc (080160 KS), and Very Good Leisure Co Ltd (094850 KS) (also called Very Good Tour) as comparable companies to JTC. The average P/E of the three comps is 20.5x, which is based on their annualized 1Q-3Q17 net profit. The annualized net profit of JTC is 20.7 billion won and applying this multiple results in an implied price (pre-IPO discount) of 12,074 won. Applying the IPO discount of 37.1% to 48.7%, this results in the IPO range of 6,200 won to 7,600 won. On a consolidated basis, the company's sales increased 113.8% YoY to 626.7 billion won in FY15 (lasting from March 2015 to February 2016). Most of its sales (98% of total) are from duty-free shops and the remaining sales are from real estate rents and others. Its operating profit also increased 190.3% YoY to 90 billion won in FY15. JTC's operating margin increased from 10.6% in FY14 to 14.4% in FY15. 

JTC IPO Preview (Part 1) - A Japanese Duty-Free Shop Operator Listing on the Korean Stock Market

Japan

JTC Inc. operates duty free stores. The Company retails cosmetics, jewelry, foods, home appliances, digital equipment, and other products. JTC also operates its businesses overseas.

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JTC Inc/Fukuoka (950170 KS)

JTC IPO Preview (Part 1) - A Japanese Duty-Free Shop Operator Listing on the Korean Stock Market

JTC is a duty-free shop focused company in Japan that is preparing for an IPO on the Korean stock market. JTC is planning to raise between US$61...

Douglas Kim

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