A Case Study of Valuation Considering the Characteristics of E-Commerce Distribution: Focusing on the Coupang IPO

SHIN, I. , Inkyung, Y. , & LEE, H. (2023). A Case Study of Valuation Considering the Characteristics of E-Commerce Distribution: Focusing on the Coupang IPO. , 21(4), 91-101, https://doi.org/10.15722/jds.21.04.202304.91

copy

Abstract

Purpose: Research on the valuation of the e-commerce distribution companies is necessary because the traditional valuation methodology cannot be easily applied. Considering the valuation and initial public offering (IPO) of Coupang, Korea’s leading ecommerce company, this study contributes to the literature by examining various valuation methods applicable to corporate valuation in the e-commerce industry and provides their implications. Research design, data and methodology: This case study investigates research, analyst reports, news articles, and magazines to review the valuation methods for companies in the e-commerce industry and analyzes the case of the Coupang IPO. Results: A valuation method that considers growth potential, which is important for companies in the e-commerce industry, is used for IPOs. This led to Coupang’s successful IPO on the New York Stock Exchange despite its accumulated losses. However, the continued price decline since listing suggests that Coupang’s valuation should have considered more factors. Conclusions: This study provides guidelines for the valuation of companies in the e-commerce industry, which eventually improves the overall industry. Moreover, this study provides directions for improving the valuation methods for e-commerce firms.

keywords: IPO, Valuation Method, E-Commerce Industry, E-Commerce Distribution, Coupang

Reference

Chen, H. Y., Zhang, S. L., & Zhang, Y. (2008). Research on transaction mode of direct power purchase by large consumers in electricity market. Power System Technology, 32(21), 85-90.

Eisape, D. (2019). The Platform Business Model Canvas a Proposition in a Design Science Approach. American Journal of Management Science and Engineering, 4(6), 91-107.

Eugene Investment and Securities. (2020). Initiation Report: Internet/Platform.

Fernandez, P. (2001). Valuation using multiples. How do analysts reach their conclusions. IESE Business School, 1, 1-13.

Hana Financial Investment. (2022). Retail Weekly Letter: Coupang.

Hines, P., Rich, N., & Esain, A. (1998). Creating a lean supplier network: a distribution industry case. European Journal of Purchasing & Supply Management, 4(4), 235-246.

Kim, J. (2014). Platform business and network strategy. STI Policy Review, 5(1), 57-74.

Kim, S. H. (2021). A study on the distribution platform business based on Shinsegae group. Journal of Distribution Science, 19(4), 15-24.

Kim, E., Jun, J., & Hyun, J. H. (2022). The Competencies of Sellers in e-Commerce and Innovative Sales Activities for Sales Performance. Journal of Distribution Science, 20(1), 99-108.

10.

Kiwoom Securities. (2021). Industry Brief: Coupang.

11.

Korea Chamber of Commerce and Industry. (2022) Next Commerce: A New Platform Dominating Distribution and Manufacturing Industry, 2022 Emerging Trends in Distribution Industry Seminar.

12.

Kyobo Securities Research center. (2021). Industry Report: Inception in 2021

13.

Kyobo Securities Research center. (2022). Kyobo Intelligence Forum: Retail Insight.

14.

Kyobo Securities Research center. (2021). Spot Report: Internet.

15.

Lee, Y. M. (2016). Study on E-commerce Evaluation Model: Focused on Internet Business Model. Journal of Distribution Science, 14(1), 85-91.

16.

Park, Y. E., & Allui, A. (2019). eBay: Smart entry strategy into the Korean market through M&A and its post-merger integration. Journal of Distribution Science, 17(1), 47-56.

17.

Ruanguttamanun, C., & Peemanee, J. (2022). Causal Relationship between e-Service Quality, Online Trust and Purchase Intentions on Lazada Group, An Asia's Leading E-commerce Platform. Journal of Distribution Science, 20(1), 13-26.

18.

Securities and Exchange Commission. (2021). FROM S-1 (General form for registration of securities under the Securities Act of 1933)

19.

Securities and Exchange Commission. (2021). FROM 424B4 (Prospectus [Rule 424(b)(4)] Open document)

20.

Samjong KPMG ERI. (2021). New Valuation Era, Valuation of New Growth Industry: Issue monitor

바로가기메뉴

Article Contents

Vol.21 No.4

A Case Study of Valuation Considering the Characteristics of E-Commerce Distribution: Focusing on the Coupang IPO

Abstract

Reference

The Journal of Distribution Science