Rising Expectations for Cloud Market Growth... Douzone Bizon Hits Record Highs

[Asia Economy Reporter Eunmo Koo] Duzon Bizon, a company specializing in enterprise solutions, is continuing its strong upward trend by hitting an all-time high. It is analyzed that the market's expectations for cloud companies are driving the rise.

According to the Korea Exchange on the 13th, Duzon Bizon's stock price rose 13.5% just this month until the previous day. Expanding the period since the KOSPI hit its low on March 19, it showed a return of 82.0%, significantly outperforming the KOSPI's rise of 31.9% during the same period. With the stock price soaring, the market capitalization, which was 2.4034 trillion KRW at the end of last year, expanded to around 3 trillion KRW (2.9969 trillion KRW) as of the previous day. As of 9:30 AM on the day, it was trading at 108,000 KRW, up 6.93% (7,000 KRW) from the previous trading day. During the session, it even rose to 115,000 KRW, marking an all-time high.

The market's expectations for cloud companies are interpreted as influencing Duzon Bizon's recent upward trend. Donghwan Oh, a researcher at Samsung Securities, said, “As concerns over the COVID-19 pandemic ease, valuations of global cloud companies are rising,” adding, “Since the market already expects an increase in deferred demand after the COVID-19 situation, a short-term stock price rise due to valuation (stock price relative to performance) increase is expected for Duzon Bizon as well.” It is also positively evaluated that the government is expected to activate non-face-to-face businesses including cloud and fintech.

Moreover, despite the impact of COVID-19, the fact that Duzon Bizon has maintained an upward trend in sales and operating profit for 22 consecutive quarters compared to the same period last year, and announced stable results for the first quarter of this year, is also analyzed to have strengthened the upward momentum. Duzon Bizon announced on the 27th of last month that its sales and operating profit for the first quarter of this year were 71.2 billion KRW and 16.3 billion KRW, respectively, up 13.8% and 17.8% compared to the same period last year.

The direction of future stock price and performance is analyzed to hinge on the growth rate of customers for ‘WEHAGO T’. Sangheon Lee, a researcher at Hi Investment & Securities, said, “After the comprehensive income tax filing in May, the number of tax offices joining will increase further,” and forecasted, “If new businesses in cloud, big data, fintech, etc., through WEHAGO, enter a virtuous cycle where synergy effects are realized, growth potential could be highlighted.” WEHAGO T is an integrated information system that provides cloud-based services for the work and overall business of tax accounting offices of Duzon Bizon. As of the end of March, the number of accounting offices using it was about 3,300, and the number of clients was about 1,700.

Meanwhile, according to the results of the Morgan Stanley Capital International (MSCI) semi-annual review in May, Duzon Bizon was included in the MSCI Korea Index. The MSCI index is a stock index announced by MSCI, a subsidiary of the US investment bank Morgan Stanley. Stocks included in the index are used as benchmarks for passive investment according to their weight in the index, thus greatly affecting the supply and demand and stock price of the included stocks. Shinhan Investment Corp. estimated the passive fund purchase demand for Duzon Bizon at 143.6 billion KRW, which is 6.3 times the average daily trading volume.

This content was produced with the assistance of AI translation services.