Goodai Global, which operates brands such as "Beauty of Joseon," recently completed a stock split and is speeding up preparations for its initial public offering, putting distribution and platform corporations preparing to list, including Musinsa and Kurly, on alert. That is because the valuation Goodai Global is recognized for during the actual offering process could affect how the market values Musinsa and Kurly, which have been building beauty into a new pillar of growth.
Recently in the domestic stock market, fashion corporations have continued to suffer weak share prices, and large e-commerce corporations such as Kurly and SSG.com struggled with listings in the past. In contrast, K-beauty corporations are growing rapidly in global markets and are seen as deserving relatively high valuations. The valuation level Goodai Global records during its offering is expected to serve as a yardstick for these corporations' future IPO strategies.
According to related industries on the 1st, Goodai Global recently carried out a 50-to-1 stock split, lowering the par value per share from 5,000 won to 100 won and increasing the number of shares outstanding from 61,000 to 3.05 million. It also reorganized its capital structure, including expanding the authorized number of shares in its articles of incorporation to 1 billion. The industry sees a high possibility that Goodai Global will file for a preliminary KOSPI listing review this month and debut on the market early next year.
Goodai Global's target valuation is discussed at around 10 trillion won. In the process of issuing 800 billion won in convertible bonds last year, the company was valued at about 4.4 trillion won post-investment. It is effectively aiming for more than double its valuation in just over a year.
Goodai Global's IPO performance is also expected to be a reference point for Musinsa. Musinsa has not yet disclosed a specific listing timeline, but the market has mentioned the possibility of filing for a preliminary listing review as early as the third quarter.
Musinsa is targeting a valuation of around 10 trillion won. However, there is talk that it will be difficult to be recognized for such a valuation based solely on its core fashion platform business. In fact, the offering price of the fashion brand operator Piece Piece Studio Co., Ltd., which listed on KOSDAQ in June, was 21,500 won, but by the end of last month the share price had fallen to 5,000 won. That is about 77% below the offering price.
Share price trends of already listed fashion corporations are also weak. Handsome(020000) closed at 15,810 won on the 31st of last month. That is about 45% lower than the 1-year high of 28,750 won. This underpins concerns that it is difficult to apply high growth multiples to fashion corporations.
In this situation, Musinsa's move to rapidly build beauty as a growth pillar beyond fashion is drawing attention. The company appears to be expanding its business scope from a simple fashion platform to one that handles both fashion and beauty, aiming to strengthen the growth story it will present during a future IPO.
In April, Musinsa opened its first permanent beauty store at Musinsa Megastore Seongsu. The average daily online transaction amount of the more than 500 brands that entered the store increased about 35% compared with before entry. At the online "Musinsa Beauty Festa" held last month, more than 800 brands participated, and participating brands' transaction amounts rose 246% from a year earlier. Musinsa also plans to open large standalone "Musinsa Beauty" stores of about 400 pyeong each in Hongdae and Seongsu in Seoul this month and in November, respectively.
Goodai Global's listing report card is expected to be a meaningful case for Kurly, which postponed its IPO once. Kurly passed the KOSPI preliminary listing review in 2022 but delayed the listing the following year, citing a sluggish stock market and a decline in valuation.
Kurly is also building Beauty Kurly into a new growth pillar. In the second quarter of this year, Beauty Kurly's transaction amount increased 13.5% from a year earlier. By moving beyond food-centered e-commerce to expand its business portfolio into beauty and fulfillment, it appears to be rebuilding valuation for another IPO attempt.
Profitability in the core business is also improving. Kurly posted its first annual operating profit since its founding last year, followed by second-quarter sales of 734.8 billion won and operating profit of 27.4 billion won this year, marking its highest-ever quarterly operating profit. Collaboration with Naver is also delivering results. The monthly transaction amount of "Kurly N Mart," launched on Naver Plus Store in September last year, increased about tenfold in one year.
An industry official said, "In a situation where fashion and e-commerce corporations find it difficult to receive high valuations based on existing businesses alone, Goodai Global's IPO performance will be a benchmark for whether the beauty business can actually lead to a re-rating of corporate value."