The operator of the fashion brand "Mardi Mercredi," known for its floral graphics, Piece Piece Studio Co., Ltd., has been accelerating expansion in China and share buybacks since its listing last month. It had highlighted its entry into China to boost its corporate value even before listing, but the share price has fallen more than 70% from the offer price. The market is watching whether the growth strategy presented during the initial public offering (IPO) can actually support performance.
On the 14th, according to the Korea Exchange (KRX), Piece Piece Studio Co., Ltd. closed at 5,450 won, up 280 won (5.4%) from the previous day. It extended gains for a second straight day following the announcement of a decision to buy back shares, but the closing price is about 75% lower than the offer price (21,500 won). Its market capitalization fell about 60%, from 194.5 billion won at the close on the listing day to 77.2 billion won.
Earlier, Piece Piece Studio Co., Ltd. began trading at 32,000 won on the first day of listing on the 8th of last month, 48.8% above the offer price. At one point intraday it climbed to 42,000 won, about 85% above the offer price, but it gave up all gains as investors took profits. The slide continued, and on the 8th it fell to 4,590 won.
The growth keyword the company pushed hard during the IPO process is China. Piece Piece Studio Co., Ltd. completed the establishment of a Chinese subsidiary in May ahead of institutional bookbuilding and shifted its license-centered business model to direct management by headquarters. The strategy is for headquarters to directly manage product planning, pricing, and marketing to strengthen brand control and secure sales data. It also presented a goal of growing annual sales in China to the 100 billion won range by 2028.
The China business is gaining traction. Mardi Mercredi opened official direct channels on Tmall, Douyin, and Xiaohongshu on the 5th of last month, logging about 600 million won in first-day sales and securing about 7,000 purchasing customers. Then on the 11th, it ranked No. 1 overall on Taobao Live in the local live-commerce market, with sales of about 700 million won. In the second half, it plans to open a flagship store in the Anfu Road area of Shanghai and expand by linking online and offline.
Investments to expand the growth base have continued since the listing. It is conducting open hiring in double digits for key roles in global business, merchandising (MD), design, marketing, and retail, and it signed a 10 billion won share buyback trust agreement. Management also said it plans to donate part of its holdings to the company without compensation for cancellation.
However, the China business results disclosed so far are early sales figures such as the opening of direct channels and live commerce, and the cumulative sales in China, the contribution to total sales, and profitability still need to be watched. As recent growth has slowed, the market is focusing on whether the China business will lead to a real rebound in results.
Piece Piece Studio Co., Ltd. posted sales of 117.9 billion won and operating profit of 16.7 billion won last year. Compared with 2024, sales rose 3.6%, while operating profit fell by more than 40%. In the first quarter of this year, sales were 23.4 billion won, down 30% from a year earlier, and operating profit fell about 75%.
Amid weak results and share price, controversy over the offer price valuation raised during the IPO process is resurfacing. Despite slowing growth, Piece Piece Studio Co., Ltd. finalized its offer price at 21,500 won, above the top of the hoped-for band (18,000–21,000 won), sparking overvaluation concerns. At the time, AU BRANDZ(481070) and Gamsung Corporation(036620) were used as peer corporations, and direct entry into China and global expansion were presented as core growth strategies.
In the securities industry, there are cases where fashion and beauty corporations are recognized for high corporate value based on brand awareness and overseas growth potential, but after listing, actual sales and profitability are seen as determining evaluations. A securities firm official said, "Market assessment will also change once it is confirmed that the China business leads not just to one-off hits but to steady increases in sales and profit."