In this video, I will be talking about the "South Korean Amazon" called Coupang (CPNG 1.30%) and whether it is a buy right now, being down 40% since going public. You can find the video below.
What is Coupang?
Coupang is South Korea's largest e-commerce player, offers the fastest delivery, has the largest logistics footprint, and controls the whole customer experience, which is very important and a huge moat. It went from being called the Groupon of South Korea to being called the Amazon of South Korea -- a definite step up. That shows how quickly things can pivot with the right management and vision.
Right now Coupang mostly operates in South Korea, but some reports have indicated that it is testing the waters in Japan and Taiwan. In terms of 2020 revenue, South Korea is the 12th-largest economy and sixth-largest market for e-commerce, ahead of France and behind Germany.
What's next?
Coupang reported second-quarter revenue growth of 71% and adjusted gross profit growth of 86%. Active customers increased 26% year over year to 17 million and revenue per active customer grew 36% year over year. The company's two newest segments, Fresh and Eats, are showing strong growth. Fresh's revenue grew over 100% YOY and Eats' revenue has nearly tripled over the past two quarters.
There are a couple of reasons the stock is down 40% since going public, but the most relevant is uncertainty about whether it can succeed outside of South Korea.
For full insights watch the video below.
*Stock prices used were the closing prices of September 3, 2021. The video was published on September 4, 2021.
