Oasis, the only surviving early morning delivery e-commerce (e-commerce) company, eventually withdrew its listing. This is the second time an early morning e-commerce delivery company has withdrawn from a listing.
Oasis announced on the 13th, “We conducted demand forecasts to determine the final public offering price, but given all the conditions, such as the difficulty in properly evaluating the value of the company, we will cancel the remaining schedule and submits a withdrawal report with the consent of the joint lead manager.” .
Initially, Oasis was hoping for a public offering price between 30,500 won and 39,500 won. If the public offering price were recognized at this level, Oasis’ market capitalization would be between 967.9 and 1.2535 trillion gained. However, it is known that only 60% of the original corporate value was recognized as many institutional investors participated in anticipating demand at a price lower than the desired public offering price.
An official from the investment industry (IB) said, “Institutional investors wrote down the public offering price in the mid-20,000 won range.” I think it’s unreasonable to be recognized.”
In the IB industry, there are voices that must be acknowledged that the view on e-commerce companies has changed completely from a year or two ago. The general view was that the market atmosphere was frozen in an instant, such as a sudden increase in interest rates, even with Curley withdrawing from listing, but the atmosphere was not bad, as the stock market showed a bull market short term recently.
In addition, Oasis is smaller than Curly, but it is the only company that makes a profit among early morning e-commerce delivery companies. An analyst responsible for distribution in a stock market said, “I am very skeptical of the business model of e-commerce companies, regardless of their market share or surplus.” In a word, the evaluation of the work is negative.”
The biggest reason investors have changed their view is that the growth of the online market is slowing down. According to the sales trends of major distributors published by the Ministry of Trade, Industry and Energy, the growth rate of online sales decreased to ▲ 18.4% in 2020 ▲ 15.7% in 2021 ▲ 9.5% in 2022. On the other hand, sales off- line ▲ -3.6% in 2020 ▲ 7.5% in 2021 ▲ 8.9% in 2022.
An official from the delivery industry said, “The endemic (endemic) period of the Corona 19 era is a bad thing for e-commerce delivery companies early in the morning,” and said, “As offline consumption based on face-to-face activities in face increase, online use is bound to decrease.”
Investors are well aware of the progress of Curly, the leader in early morning e-commerce delivery. Curley announced earlier this year that it would delay its IPO indefinitely. It was decided that it would be better to wait for the right time to run the business than to go public in a situation where the corporate value is not properly recognized.
Curly’s enterprise value was once higher than 4 trillion won, but recently it has dropped to the 1 trillion won level. Curly, who has begun to suffer, continues his business by starting a new curly beauty business to prepare for the endemic age and adding two new distribution centers. A Curly official said, “A company that can continue its business without listing at a time like this is a solid company.”
However, in the investment industry, there are many evaluations that Curly is in the process of overcoming a difficult situation that resembles a dilemma. As of the first half of last year, it is estimated that Curly’s cash holdings are about 400 billion won, but if the deficit level in 2021 repeats, this amount of cash holdings can be exhausted in two years. Curley has been consistently in the red since 2019. The deficit in 2019 was 98.6 billion won, but as sales increased, the deficit in 2021 increased to 217.7 billion won.
An investment industry official said, “It is difficult to attract investment while lowering the corporate value, and it is difficult to attract support from existing investors, and we cannot recognize this atmosphere and go public.” We need to plant it, but it will do. be difficult to convert in a short period of time,” he said.
Shinsegae (004170)SSG.com, a group-affiliated e-commerce company, SK(034730)11st, an e-commerce company affiliated with the group, is also concerned. SSG.com, which selected an IPO organizer in October 2021, is struggling to create a business model for a turnaround this year. An official from SSG.com said, “This is a year to focus more on internal stability.”
11st is also not currently expediting the listing process and is watching. 11th Street was expected to be recognized for its 2.7 trillion won corporate value when it selected its host company in August last year, but its recognized corporate value in the over-the-counter market is currently in the mid- 1 trillion won. .
An official from the e-commerce industry said, “Companies that have focused solely on growth indicators are now under pressure to cut their losses and ultimately show a turnaround.” he said.
