[Infostock Daily=Reporter Lee Dong-hoon] Hyundai Motor Securities maintained an investment opinion of 'Buy' on Kakao and the target price of 530,000 won.
According to media reports, Kakao, Shinsegae, MBK Partners, Carlyle, and KKR are known to participate in the acquisition of the nation's third-largest online shopping operator, eBay Korea.
Hyundai Motor Securities analyzed, "As of the end of last year, Kakao's net cash holdings is about 3 trillion won, and the acquisition of eBay Korea, which is estimated in the market is up to 4.2 trillion won, including 2.8% (market capitalization of 1.2 trillion won). However, it is inevitable that the strategic alliance or M&A of its own resources using the equity swap will be difficult after the acquisition. Kakao has expanded its commerce in earnest and clarified its intention to enter the major market."
The securities firm stated, "Kakao is expected to be a prominent competitor for Naver and Coupang in terms of the overwhelming platform advantage of KakaoTalk. However, five companies are willing to acquire eBay Korea, but the price is too high. Coupang is considered to be excluded from the acquirable business group in the first place because the total amount of IPO funds is USD 3 billion (3.4 trillion won). In the case of Naver, the acquisition resources are sufficient even if more than 10% of its shares are utilized."
The momentum is expected to be maximized in the first half of the year as the value of the stake is realized in SOTP valuation.
Reporter Lee Dong-hoon usinvestmentidea2020@gmail.com
