[IPO Spotlight] Oasis, the Only Profitable Food E-commerce... Can It Revive the Sluggish IPO Market?

Direct Purchase from Production Sites with In-House Logistics
Only Domestic Food E-commerce in the Black
2nd Place in Last Year's Sales After 'Kurly'
Advantageous Inventory Management at 60 Stores
Plans for IPO with 6.52 Million Shares Within the Year

[Asia Economy Reporter Park So-yeon] Oasis, a dawn delivery company specializing in organic fresh food, currently boasts the strongest position in the initial public offering (IPO) market. It is the only profitable company among domestic food e-commerce firms.

Oasis was founded in October 2011 by former CEO Kim Young-jun, who came from Woori Consumer Cooperative (Woori Saenghyeop). After entering the dawn delivery business in 2018, it secured 1 million members within four years.

In a fiercely competitive domestic e-commerce market, Oasis operates both online and about 60 offline stores, securing a relatively advantageous position in inventory management. Oasis owns logistics centers in Seongnam and Uiwang, Gyeonggi Province, capable of delivering up to 370,000 orders per day.

Unsold inventory through dawn delivery is sold at offline stores to reduce waste rates. Products sent to offline stores are sold with discounts applied, making it less likely for them to become inventory again. Only the amount of logistics needed twice a day is brought in, and all inventory is displayed in stores, so there is no separate warehouse rental cost for storing inventory, which is also an advantage.

Minimizing distribution stages through direct purchase from production areas and building an in-house logistics system form the foundation of profitable management. Thanks to the personnel who operated the consumer cooperative leading the business, it was advantageous in sourcing products with quality and price competitiveness.

Sales have shown growth, reaching 142.3 billion KRW in 2019, 238.6 billion KRW in 2020, and 357 billion KRW in 2021. Based on 2021 sales, Oasis ranks second in the industry after Kurly (1.5614 trillion KRW). Operating profit recorded 1 billion KRW in 2019, 9.7 billion KRW in 2020, and 5.7 billion KRW in 2021.

In the first half of this year, sales increased by 21% year-on-year to 202.4 billion KRW, and operating profit grew by 171% to 7.19 billion KRW.

Oasis emphasized that it aims to go public within this year by applying for preliminary review for listing with the Korea Exchange last September. The total number of shares planned for listing is 32.64 million, of which 6.528 million shares will be offered to the public. The lead underwriters for the listing are NH Investment & Securities and Korea Investment & Securities.

Continuing cooperative projects with various distribution companies such as E-Land Retail, KT Alpha, and Home & Shopping is also a notable feature of Oasis’s business strategy. In June, Oasis attracted a strategic investment of 33 billion KRW from E-Land Retail. They agreed to prioritize partnerships in facility investment, new business entry, and mergers & acquisitions (M&A). The existing Kim’s Club Mall transformed into Kim’s Oasis Mall, with Oasis taking charge of online mall operations and dawn delivery services.

Recently, Oasis established a joint venture in cooperation with KT Alpha, a digital home shopping company affiliated with KT. Oasis is responsible for KT Alpha’s fresh processed food dawn delivery and plans to expand the dawn delivery product categories and enable same-day delivery services in the future.

The investment banking (IB) industry has valued Oasis at about 1 trillion KRW. The company was listed as a unicorn by the Ministry of SMEs and Startups in the first half of this year. Starting with investment attraction from Korea Investment Partners in April 2020, it consecutively secured investments from Kakao Investment, Must Ventures, Pentastone-Cornerstone, and Unison Capital. Then, in October last year, it raised a total of 10 billion KRW from Korea Investment & Securities and NH Investment & Securities, each investing 5 billion KRW, valuing the company at 1.01 trillion KRW and joining the 1 trillion KRW club.

The largest shareholder of Oasis is GeoSoft, holding 55.17% of shares. The largest shareholder of GeoSoft is former Oasis CEO Kim Young-jun. The second and third largest shareholders of Oasis are Korea Investment Partners (13.32%) and Unison Capital Korea (11.76%), respectively. E-Land Retail is also listed as a strategic investor (SI) on the shareholder roster.

So far, Oasis has focused on solid business fundamentals, but there is analysis that an expansion strategy is necessary to increase corporate value in the future. Some point out that Oasis’s relatively small scale compared to other e-commerce companies is a weakness. Going forward, Oasis is expected to lead business expansion through expanding food category lines, increasing offline stores, and entering logistics agency and instant delivery businesses.

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