Korea / Special Situations, Clepsydra Capital

Sanghyun Park

I investigate special situations in Korea.

Korea / Special Situations

Korea's Ongoing IPOs Subscription & Listing Schedule: Krafton Listing Date May Be Delayed

Kakao Bank & Kakao Pay Listings in Close Proximity: Institutional Cannibalization Risk

Krafton's Index Play: KOSPI 200, MSCI Std, FTSE AW, FnGuide Top 10, & KRX BBIG

Krafton IPO Offering Price/​Size Adjustment & Valuation Re-Review

Krafton's Strategic Intention Behind High Offering Price & FSS Correction Request Possibility

Krafton's Biggest Lie About Tencent Relationship & Regulation Risk in China

FSS's Position on Krafton IPO & The Mood of Foreign Investors Revealed by Mirae Asset

Krafton and Mirae Asset Are Playing a Fairly Risky Game

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Equity Capital Markets

<p>Regulatory risk in China, triggered by the DiDi Chuxing incident, is again emerging as the most important issue for Krafton's listing.</p><div class="content-highlight"><p><strong>IR will also start when the book opens on July 14th. And it goes on until the 27th. The question that will most likely come up from investors during this period is undoubtedly the sustainability of the fees it receives from Tencent, which currently accounts for 70% of its sales.</strong></p></div><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Schedule"}'>Schedule</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Previous"}'>Previous</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Adjusted"}'>Adjusted</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Book open"}'>Book opens &amp; IR begins</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44375}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 6. 28</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44391}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 7. 14</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Book close"}'>Book closes &amp; IR ends</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44386}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 7. 9</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44404}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 7. 27</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Subscription"}'>Subscription</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44391}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 7. 14</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44410}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 8. 2</strong></td>
</tr>
<tr><td colspan="3" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><h2>Krafton's lie</h2><p>Krafton, which is about to go public, announced that it is providing technical services to Tencent's mobile game Peacekeeper Elite (和平精英) and is receiving a fee. This is causing controversy as to whether Krafton has lied so far and actually provided game services in China through a detour.</p><p>China's National Radio and Television Administration publishes new business license status every month. Chinese game companies are granted domestic licenses, and overseas game companies are granted foreign licenses. After the THAAD incident, Korean game companies have not been issued foreign licenses except for Summoners War developed by Com2uS.</p><p>Krafton stopped the Chinese version of PUBG Mobile in May 2019 when it failed to receive a business license. However, when this service was updated, it was automatically changed to Peacekeeper Elite (和平精英), which Tencent serviced, causing controversy over detours. Krafton argued at the time that the two games were separate and unrelated. Krafton also said that it did not receive <strong>royalties</strong> from Tencent.</p><p><strong>However, as it was officially revealed during the IPO process that the Peacekeeper Elite (和平精英) royalties were received, this issue, apart from Krafton's lies, is leading to questions about the sustainability of the Peacekeeper Elite (和平精英) service in China in the future.</strong></p>

Regulatory risk in China, triggered by the DiDi Chuxing incident, is again emerging as the most important issue for Krafton's listing.IR will also start when the book opens on July 14th. And it goes on until the 27th. The question that will most likely come up from investors during this period is undoubtedly the sustainability of the fees it receives from Tencent, which currently accounts for 70% of its sales.







Schedule
Previous
Adjusted


Book opens &amp; IR begins
2021. 6. 28
2021. 7. 14


Book closes &amp; IR ends
2021. 7. 9
2021. 7. 27


Subscription
2021. 7. 14
2021. 8. 2

Source: DART

Krafton's lieKrafton, which is about to go public, announced that it is providing technical services to Tencent's mobile game Peacekeeper Elite (和平精英) and is receiving a fee. This is causing controversy as to whether Krafton has lied so far and actually provided game services in China through a detour.China's National Radio and Television Administration publishes new business license status every month. Chinese game companies are granted domestic licenses, and overseas game companies are granted foreign licenses. After the THAAD incident, Korean game companies have not been issued foreign licenses except for Summoners War developed by Com2uS.Krafton stopped the Chinese version of PUBG Mobile in May 2019 when it failed to receive a business license. However, when this service was updated, it was automatically changed to Peacekeeper Elite (和平精英), which Tencent serviced, causing controversy over detours. Krafton argued at the time that the two games were separate and unrelated. Krafton also said that it did not receive royalties from Tencent.However, as it was officially revealed during the IPO process that the Peacekeeper Elite (和平精英) royalties were received, this issue, apart from Krafton's lies, is leading to questions about the sustainability of the Peacekeeper Elite (和平精英) service in China in the future.

滴滴出行スキャンダルの中、クラフトンのテンセントとの関係における中国リスク：主な論点