US-listed Coupang Nears Goal as 'Korea's Amazon'... Aggressive Investment Expected to Continue

March IPO Likely, Corporate Valuation Expected at $50 Billion

[Asia Economy Reporter Kim Cheol-hyun] Coupang, the largest e-commerce company in South Korea, has officially announced its plan to list on the U.S. stock market, bringing its goal of becoming the "Amazon of Korea" much closer. Until now, Coupang had only stated that it would pursue an initial public offering (IPO) "when the time is right," refraining from discussing specific plans. However, after nearly doubling its sales amid the COVID-19 pandemic last year, the company appears to have judged that now is the optimal time for listing. If Coupang succeeds in raising substantial funds through this IPO, it is expected to continue its aggressive investment strategy.

On the 12th (local time), Coupang announced through a filing with the U.S. Securities and Exchange Commission (SEC) that it had submitted a registration statement for listing on the New York Stock Exchange (NYSE). Coupang stated that it filed the registration statement using Form S-1 for the listing of Class A common shares. The number of shares and the price range for the offering have not yet been decided, and the company plans to list under the ticker symbol 'CPNG' on the NYSE. A Coupang representative said, "The securities registration statement will not be submitted in South Korea in relation to this IPO," and added, "There will be no solicitation of investment from domestic investors."

◆ March Listing Likely = Following the IPO procedures, Coupang is expected to soon conduct a roadshow for investors, finalize the offering price, and then begin trading on the NYSE. Considering the time required for these steps, barring any unforeseen circumstances, Coupang's debut on the New York Stock Exchange is likely to occur in March, about a month from now.

The background for Coupang's push for listing this year is closely linked to COVID-19. Coupang has built nationwide infrastructure capable of next-day delivery, which led to a surge in sales during the pandemic last year. In fact, Coupang disclosed in its SEC filing that its revenue last year was $11.97 billion (approximately 13.25 trillion KRW), an increase of about 91% from 7.1 trillion KRW in 2019. The net loss was $474.9 million (approximately 525.7 billion KRW), down about 150 billion KRW from 720.5 billion KRW in 2019, showing a steady reduction in losses. The continued strong investor interest in the U.S. IPO market this year, following last year, is also a factor behind Coupang's decision to go public.

◆ Corporate Valuation Around $50 Billion = Earlier this year, Bloomberg reported that at least six companies invested in by Japan's SoftBank, including Coupang, are preparing for IPOs this year, with Coupang's valuation expected to exceed $30 billion, equivalent to about 32 trillion KRW.

With Coupang's listing now official, its valuation is expected to rise further. The Wall Street Journal (WSJ) reported on the 12th (local time) that Coupang's IPO is expected to be the largest foreign company IPO since Alibaba Group's debut in 2014. Alibaba was valued at $168 billion (approximately 186 trillion KRW) at the time of its IPO. WSJ reported that Coupang's valuation is expected to exceed $50 billion (approximately 55.4 trillion KRW).

The UK's Financial Times (FT) also recently evaluated Coupang as one of the largest foreign company IPOs on the NYSE in recent years, expecting a market valuation exceeding $50 billion.

◆ Continued Aggressive Investment Expected = If Coupang succeeds in raising large-scale funds through the IPO, it is expected to continue its aggressive investment strategy. Starting as a social commerce platform in 2010, Coupang transformed into an e-commerce company in 2014 by discontinuing its social commerce business and introducing "Rocket Delivery." By directly purchasing products to ensure quality and emphasizing fast delivery, it improved customer satisfaction. Building on this foundation, Coupang aimed to evolve into the "Amazon of Korea." This strategy paid off, with sales growing nearly 25-fold from 300 billion KRW in 2014 over five years. This growth was supported by investments such as the $3 billion (approximately 3.3 trillion KRW) from Japan's SoftBank. However, continuous investments led to accumulated losses, which is why there have been ongoing expectations for additional fundraising through an IPO.

With the capital secured through the listing, Coupang is expected to expand investments in new businesses and discover new growth engines in related fields including e-commerce. Already, the delivery app Coupang Eats quickly established itself in the market last year amid increased delivery demand due to COVID-19, and the online video service (OTT) has officially launched. Coupang also plans to produce original content, which is expected to have a significant impact on both the e-commerce and OTT industries. The company has also entered the live commerce market in earnest and has reacquired its qualification as a parcel delivery operator, preparing related businesses. Mirae Asset Securities predicted in a report last year that "Coupang's competitiveness in the online market will continue to increase."

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