Photo = AP
As Coupang started trading on the New York Stock Exchange (NYSE, photo) on the 11th, domestic investors can also trade stocks. Although the offering price was set at $35, which exceeded the desired range, the stock price is expected to rise after listing. However, it is pointed out that in the early days, the stock price may fluctuate due to the amount of profit-taking, so it is necessary to be careful not to buy excessively.
According to NH Investment & Securities, the market capitalization based on an offering price of 35 dollars is 3.7 times the expected sales of Coupang this year. Lee Ji-young, a researcher at this securities firm, said, “It is reasonable compared to that of Amazon’s 3.3 times, eBay’s 3.2 times, and Alibaba’s 6.0 times.”
Coupang’s investment appeal is its growth potential. Funds raised by this public offering amounted to 4 trillion won, which is expected to enable further growth. Researcher Lee analyzed that “Coupang’s market dominance will accelerate if the funds raised by Coupang are invested in expanding distribution centers, building big data, and recruiting human resources.”
Some analysts say that “Coupang’s potential exceeds Amazon.” According to a report released by Goodwater Capital, an American venture capital (VC), Coupang’s share of the Korean e-commerce market increased from 18.1% in 2019 to 24.6% in 2020, overtaking its competitors. It surpassed Amazon in the’dollar retention rate’ indicator, which shows how much shopping mall user spending has increased year by year. In 2020, Coupang customers spent 346% more than in 2017. Amazon was only 278 percent lower than Coupang, even though it had the highest number among US e-commerce companies.
Famous platform companies that recently entered the U.S. stock market have been strong right after listing. Airbnb, which went public in December of last year, had an offering price of 68 dollars, but in February it rose to 216 dollars based on the closing price. Door Dash also started trading at an initial price of $182 on the first day of listing, 78.4% higher than the offering price of $102.
There is also a way to buy an exchange-traded fund (ETF) that incorporates Coupang. As it contains several new listed stocks, the volatility tends to be small. Representatively, there is a’Renaissance IPO’ (tick: IPO) ETF. The recent one-year return has exceeded 100%. There is also’First Trust US Equity Opportunity’ (tick: FPX). The two ETFs are expected to incorporate Coupang 5-6 days after Coupang is listed.
Reporter Lim Geun-ho [email protected]
Ⓒ Hankyung.com prohibits unauthorized reproduction and redistribution