이 기사는 2020년 02월 13일 08:00 thebell 에 표출된 기사입니다.

South Korea’s E.CIS Cosmetic garners strong interest from domestic capital market. As the company’s initial public offering (IPO) doesn’t go as planned, financial investors (FIs) including private equity firms are preparing to acquire its shares.

According to industry sources on February 7, some FIs have started to assess E.CIS’ valuation as the company’s planned IPO fell through.

Established in 2015, E.CIS is an original equipment manufacturer, specializing in the production of premium facial masks and other skin and hair care products. The company produces main sheet-masks of Mediheal, the country’s biggest sheet-mask brand. According to the company’s separate financial statement, E.CIS’ sales grew to 105 billion won in 2018 from 61.3 billion won in 2016. Market estimates that orders from L&P Cosmetic (Mediheal) account for around 75 percent of E.CIS’ total sales.

On this account, market watchers have mixed views on whether the company will be able to maintain its captive supplier position in case of a change in the shareholder structure. A son of Kwon Oh-sub, CEO of L&P Cosmetic, is a major shareholder of E.CIS with a 11.7 percent stake. Market watchers widely see they are related companies.

“Market watchers have constantly pointed out that E.CIS will have to diversify its source of sales to maintain its stable growth,” said an IB industry insider.

On the contrary, some view that E.CIS will continue to improve its earnings thanks to its technical skills. As a result of increasing its vendors in the U.S., E.CIS was awarded the $5 million Export Tower from Korea International Trade Association (KITA) in 2018.

It is said that although the company has continuously increased its brand awareness at home and abroad, the failure of its IPO has kept the company under pressure. E.CIS applied for a preliminary review for listing to the Korea Exchange (KRX) in July of 2019, but it withdrew its application next month.

In the meanwhile, E.CIS has announced publicly that it will proceed with its plan to be listed on the KRX's development board, Kosdaq. “Our initial plan for the IPO has not been changed,” said an E.CIS official.

(By reporter Rho Arrum)