Naver Seen Through Coupang: "It's Undervalued, But..."
[Asia Economy Reporter Junho Hwang] Korea Investment & Securities raised the target price of Naver to 540,000 KRW on the 13th, marking a significant increase of 26.4%. This reflects a reevaluation of the commerce division of Naver, the leading e-commerce company in South Korea. The benchmark used is Coupang. When looking at Naver based on Coupang's IPO price after its successful listing on the New York Stock Exchange (NYSE), it suggests that Naver holds this level of value.
Coupang's IPO price was set at $35, with a market capitalization of $88.6 billion, and it was listed on the 11th. As of the closing price on the 12th, the stock price stands at $48.47 per share. Comparing Coupang's current market capitalization to last year's transaction volume shows it is more than four times higher. Applying this to Naver's commerce division, Korea Investment & Securities' analysis suggests that Naver's value should be rated even higher. The estimated value of Naver's commerce division is about 16 trillion KRW, which is only 58.8% of last year's estimated transaction volume of 27 trillion KRW.
Hot Picks Today
"Most Americans Didn't Want This"... Americans Lose 60 Trillion Won to Soaring Fuel Costs
- "Striking Will Lead to Regret": Hyundai-Kia Employees Speak Out... Uneasy Stares Toward Samsung Union
- Man in His 50s Arrested for Confining Girlfriend in Car After She Announced Breakup
- Assaulted by Elementary Student During Class... No Protection Due to 'Instructor' Status
- "If You Booked This Month, You Almost Lost Out... Why You Should Wait Until 'This Day' Before Paying for Flight Tickets"
However, in the long term, Coupang's growth could pose a risk factor to Naver. Currently, Naver Shopping's monthly active users (MAU) are estimated to exceed 20 million, while Coupang's MAU reached 14.5 million last year and is rapidly catching up. If Coupang's MAU continues to grow and secures more loyal customers, it could be a shock to Naver. In particular, assuming that about 30% of Naver's external shopping mall transaction volume occurs on Coupang, if the cooperative relationship with Coupang breaks down, Naver's commerce revenue could decrease by approximately 57.2 billion KRW compared to the current level. This figure is based on last year's transaction volume of 27.2 trillion KRW, a 35% share of external shopping mall transaction volume, 30% share of Coupang within that, and a 2% sales commission rate.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
