[Click eStock] "YG Entertainment, Anticipating Big Bang and Blackpink Activities Post COVID-19"

[Asia Economy Reporter Minji Lee] Hana Financial Investment maintained a buy rating and a target price of 43,000 KRW on June 26 for YG Entertainment, expressing expectations for activities from Treasure 12, Big Bang, and Blackpink following the COVID-19 pandemic.

The company's revenue for the fourth quarter was 65.3 billion KRW, down 19% compared to the same period last year. Operating profit increased by 232% during the same period, reaching 10.4 billion KRW.

Researcher Kihoon Lee of Hana Financial Investment stated, “Accounting gains were reflected due to the suspension of content production business and the sale of YG Foods,” adding, “However, non-operating losses and tax penalties were also recorded, resulting in a net loss of 18.6 billion KRW.”

In the first quarter, the company is expected to report poor performance as many activities involving large gatherings, such as concerts, were postponed or canceled due to the impact of COVID-19. Recently returned groups like iKON, Sechs Kies, and Akdong Musician have had limited activities due to the pandemic.

Researcher Lee explained, “Once the COVID-19 issue subsides, joint activities of Big Bang, Blackpink, and Treasure 12 will begin,” and added, “The business suspension, which caused a combined deficit of about 9 billion KRW, will lead to structural improvements, and benefits from the easing of the Hallyu ban are also expected.”

He continued, “Treasure 12 is the fastest debuting male group in a situation where the lost fandom hegemony is returning to major agencies,” advising, “If they achieve success at a level capable of a dome tour, they are expected to become the male version of Twice, so an increase in their weighting is necessary.”