Musinsa grapples with multiple hurdles in preliminary IPO review
Customers shop at a Musinsa store in Seoul in this undated photo. Courtesy of Musinsa
IPO ambitions faces valuation, tax probe challenges
Musinsa has begun the process of going public, setting up a test to see whether investors will accept a valuation of nearly 10 trillion won ($7.4 billion) amid slowing growth and a special tax audit, market watchers said Tuesday.
Korea's largest fashion platform filed for a preliminary review of its initial public offering (IPO) on Monday, according to the Korea Exchange. Korea Investment & Securities and Citigroup Global Markets Korea are serving as lead underwriters, while KB Securities and JPMorgan are joint underwriters.
"The purpose of this preliminary review is to assess the feasibility of a listing, which we are considering as one of our financing options to support our growth as a global company," Musinsa said in a statement.
Founded in 2001, Musinsa operates its flagship online fashion platform, Musinsa Store, women's fashion platform 29CM and private-label brand Musinsa Standard. The company has been expanding beyond online retail by increasing its offline presence and pushing into overseas markets.
Musinsa has internally valued itself at about 10 trillion won, roughly triple the 3 trillion won valuation it received when it raised 200 billion won from American investment firms KKR and Wellington Management in 2023. The company is reportedly targeting an IPO valuation of about 8 trillion won after applying a discount to reflect market conditions.
Secondary-market transactions involving existing shares have more recently valued the company at about 4 trillion won, underscoring the gap between its implied market value and IPO target.
Musinsa founder and CEO Cho Man-ho / Courtesy of Musinsa
Revenue rose to 1.47 trillion won in 2025 from 993.1 billion won in 2023, while the company swung to an operating profit of 140.5 billion won from a loss of 8.6 billion won. Revenue reached 821.7 billion won in the first half of this year. Still, top-line growth has slowed.
"To achieve its target valuation, Musinsa will need to convince investors that its strong growth in recent years can translate into sustained earnings growth going forward," an industry official said.
The company is expected to emphasize its evolution beyond a domestic online fashion platform, including its private-label business and overseas operations.
A special tax audit is another potential hurdle. Since Aug. 22, the Seoul Regional Tax Office has been examining fund flows between Musinsa and Rappel, a real estate investment company personally owned by Musinsa founder and CEO Cho Man-ho. The review also covers the appropriateness of share pledges and related transactions.
Sono International, which also had been preparing for a listing this year, has seen its exchange review delayed following a tax audit.
If the exchange review proceeds smoothly, Musinsa is expected to move ahead with the offering by year-end, potentially clearing the way for a listing early next year.
As of June, Cho was Musinsa's largest shareholder with a 51.8 percent stake. Its financial investors include Sequoia Capital, KKR, IMM Investment, Wellington Management, Korea Development Bank, Anta Sports and EQT Partners.