Korea / Special Situations, Clepsydra Capital

Sanghyun Park

I investigate special situations in Korea.

Korea / Special Situations

Vespa Post IPO Trade: At a 20% Earnings Correction, Price Should Be Settled at ₩37,000

Vespa Inc IPO Preview (Part 2) - Valuation Analysis

NCsoft 2Q18 Conference Call Highlights - Time to Buy

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/27738" target="_blank" data-smartkarma-citation="entities:27738:1">Vespa Inc (299910 KS)</a>, one of Korea's rising star gaming company, offers a total 1.6M shares, of which 80% go to institutional investors. This IPO has no secondary distribution. Mirae Asset Daewoo is the banker.</li>
<li>Price band is set at ₩44,800~59,700, which puts the base deal size at ₩57.3~76.4bil. Implied market cap is ₩357.5~476.4bil. Book opens on Nov 15 and runs until Nov 16. Allotment will be announced on Nov 23 and payment will be Nov 26. Listing date is yet to be announced.</li>
<li>The banker used 7 valuation peers. But WeMade, Pearl Abyss and ME2ON should be outliers. At the Nov 7 closing prices of the 4 remaining valuation peers, average TTM PER is at 13.70x. At a 13.70x PER, Vespa's price comes down to ₩44,535 per share, which is even lower than the low end: 0.59% discount to the low end and 25.40% discount to the high end.</li>
</ul>



Vespa Inc (299910 KS), one of Korea's rising star gaming company, offers a total 1.6M shares, of which 80% go to institutional investors. This IPO has no secondary distribution. Mirae Asset Daewoo is the banker.
Price band is set at ₩44,800~59,700, which puts the base deal size at ₩57.3~76.4bil. Implied market cap is ₩357.5~476.4bil. Book opens on Nov 15 and runs until Nov 16. Allotment will be announced on Nov 23 and payment will be Nov 26. Listing date is yet to be announced.
The banker used 7 valuation peers. But WeMade, Pearl Abyss and ME2ON should be outliers. At the Nov 7 closing prices of the 4 remaining valuation peers, average TTM PER is at 13.70x. At a 13.70x PER, Vespa's price comes down to ₩44,535 per share, which is even lower than the low end: 0.59% discount to the low end and 25.40% discount to the high end.


Vespa IPO Pricing Approach: 25% Discount to High End