Korea/Asia, Events, IPOs/Douglas Research Advisory

Douglas Kim

Nearly 25 years of experience in analyzing hundreds of companies, especially in Asia. Deep expertise in the following sectors:
- Technology (E-commerce, SaaS, Internet)
- Consumer 
- Special Situations/Deep Value Plays
- Holdcos/Stubs
- Asian Unicorns/Private Companies

Kakao Pay: Downsized Rights Offering of Kakao Pay Securities & Potential Selling by Alipay

MSCI Korea Index Rebalance: Kakao Pay Included

The Blockchain Delusion. A (Mostly) Bearish Investment Thesis.

Gravity Works As WeWork Doesn't; Now Plan B

Korean Defense Plays Outperforming the Market in Light of Russia-Ukraine Conflict

Equity Bottom-Up

<ul>
<li>We believe the added threat from Apple Pay has been one of the reasons for the worsening profit margins and lower than expected sales growth of Kakao Pay in 2Q23. </li>
<li>After the poor earnings results in 2Q 2023,the consensus is likely to reduce Kakao Pay's sales estimate in 2024 by 3-5% and positive operating profit to be postponed to 2025. </li>
<li>We continue to be Bearish on Kakao Pay due to its high valuations, likelihood of consensus earnings downgrades, heightened competition, and concerns about continued profit margin weakness.   </li>
</ul>


We believe the added threat from Apple Pay has been one of the reasons for the worsening profit margins and lower than expected sales growth of Kakao Pay in 2Q23. 
After the poor earnings results in 2Q 2023,the consensus is likely to reduce Kakao Pay's sales estimate in 2024 by 3-5% and positive operating profit to be postponed to 2025. 
We continue to be Bearish on Kakao Pay due to its high valuations, likelihood of consensus earnings downgrades, heightened competition, and concerns about continued profit margin weakness.   


Kakao Pay: Worsening Profit Margins Due to Heightened Competition

Kakaopay

Kakao Pay: Worsening Profit Margins Due to Heightened Competition