Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<ul>
<li>Our valuation of SK Shieldus suggests target price of 44,892 won, which is 29% higher than the mid-point of the IPO price range of 34,900 won.</li>
<li>We would subscribe to this IPO as the company has strong business moat, especially for the physical security business and its convergence security/cybersecurity businesses are enjoying excellent customer demand.</li>
<li>Although we have a positive view of SK Shieldus, there will be some investors that stay away from this IPO due to its high debt levels and rising interest rates.</li>
</ul>


Our valuation of SK Shieldus suggests target price of 44,892 won, which is 29% higher than the mid-point of the IPO price range of 34,900 won.
We would subscribe to this IPO as the company has strong business moat, especially for the physical security business and its convergence security/cybersecurity businesses are enjoying excellent customer demand.
Although we have a positive view of SK Shieldus, there will be some investors that stay away from this IPO due to its high debt levels and rising interest rates.


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.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sk-shieldus-co-ltd" target="_blank" data-smartkarma-citation="entities:35799:1" rel="noopener">SK Shieldus (ABFHIZ KS)</a> is a leading South Korean security provider. It is pre-marketing a KRX IPO to raise up to US$0.9 billion.  </li>
<li>In <a href="https://www.smartkarma.com/insights/sk-shieldus-ipo-initiation-track-and-shield" target="_blank" data-smartkarma-citation="insights:67989" rel="noopener">SK Shieldus IPO Initiation: Track and Shield</a>, we noted that SK shieldus has attractive fundamentals with healthy growth and margins. The leverage is manageable due to good cash generation.  </li>
<li>In this note, we look at the syndicate's valuation methodology and present our valuation methodology. Our valuation analysis suggests that the IPO price range is attractive.</li>
</ul>



SK Shieldus (ABFHIZ KS) is a leading South Korean security provider. It is pre-marketing a KRX IPO to raise up to US$0.9 billion.  
In SK Shieldus IPO Initiation: Track and Shield, we noted that SK shieldus has attractive fundamentals with healthy growth and margins. The leverage is manageable due to good cash generation.  
In this note, we look at the syndicate's valuation methodology and present our valuation methodology. Our valuation analysis suggests that the IPO price range is attractive.


<ul>
<li>
<a href="https://www.smartkarma.com/entities/sk-shieldus-co-ltd" target="_blank" data-smartkarma-citation="entities:35799:1" rel="noopener">SK Shieldus (ABFHIZ KS)</a> is a leading South Korean security provider. It is pre-marketing a KRX IPO to raise up to US$0.9 billion.  </li>
<li>SK shieldus is offering 27.1 million shares with a primary/secondary split of 53/47 at an indicative price range of KRW31,000- 38,800 per share.</li>
<li>SK shieldus has attractive fundamentals with healthy growth and margins. The leverage is manageable due to good cash generation.</li>
</ul>



SK Shieldus (ABFHIZ KS) is a leading South Korean security provider. It is pre-marketing a KRX IPO to raise up to US$0.9 billion.  
SK shieldus is offering 27.1 million shares with a primary/secondary split of 53/47 at an indicative price range of KRW31,000- 38,800 per share.
SK shieldus has attractive fundamentals with healthy growth and margins. The leverage is manageable due to good cash generation.


SK Shieldus IPO Initiation: Track and Shield

<ul>
<li>In this insight, we provide further details of the four main business units of SK Shieldus, which is a leading one-stop shop provider for security services in Korea.</li>
<li>The company has been able to improve the customer churn rate of the Physical Security (CMS) unit from 14.7% in 2019 to 11.7% in 2021. </li>
<li>The leading global cybersecurity stocks have been outperforming the market this year by a big margin which should have a positive impact on the SK Shieldus IPO.</li>
</ul>


In this insight, we provide further details of the four main business units of SK Shieldus, which is a leading one-stop shop provider for security services in Korea.
The company has been able to improve the customer churn rate of the Physical Security (CMS) unit from 14.7% in 2019 to 11.7% in 2021. 
The leading global cybersecurity stocks have been outperforming the market this year by a big margin which should have a positive impact on the SK Shieldus IPO.


SK Shieldus IPO: Industry Dynamics of Four Business Units

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<ul>
<li>Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.</li>
<li>Placements continued to flow in, at a slower pace than last week, with Malaysia and ANZ chipping in.</li>
<li>While the HK IPO scene failed to produce anything noteworthy with its two listing, South Korea appears to be leading the charge, once again.</li>
</ul>


Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
Placements continued to flow in, at a slower pace than last week, with Malaysia and ANZ chipping in.
While the HK IPO scene failed to produce anything noteworthy with its two listing, South Korea appears to be leading the charge, once again.


ECM Weekly (3rd Apr 2022)- JD, Tencent, Prosus, One Store, SK Shieldus, FWD, Ferretti, Recbio, Belle

South Korea

SK Infosec Co., Ltd. develops and supplies system software. The Company provides Integrated Information security services such as security monitoring and security consulting. SK Infosec also offers film and video production services.

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SK Shieldus (393820 KS)

SK Shieldus IPO Valuation Analysis

We like this IPO of SK Shieldus as the company has strong business moat for the physical security business and its convergence security...

Douglas Kim

SK Shieldus IPO: Valuation Insights

SK shieldus is pre-marketing a KRX IPO to raise up to US$0.9 billion. Our valuation analysis suggests that the IPO price range is attractive.

Arun George

SK Shieldus IPO Initiation: Track and Shield

SK shieldus is pre-marketing a KRX IPO to raise up to US$0.9 billion. SK shieldus has attractive fundamentals with healthy growth and margins.

Arun George

SK Shieldus IPO: Industry Dynamics of Four Business Units

In this insight, we provide further details of the four main business units of SK Shieldus, which is a leading one-stop shop provider for security...

Douglas Kim

ECM Weekly (3rd Apr 2022)- JD, Tencent, Prosus, One Store, SK Shieldus, FWD, Ferretti, Recbio, Belle

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.

Sumeet Singh

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