[Click eStock] "NCSoft, Lineage2M Sales Expected to Rise... Target Price Up"

[Asia Economy Reporter Minji Lee] NH Investment & Securities maintained a buy rating on NCSoft on the 29th, expecting an increase in revenue from Lineage 2M, and raised the target price by 6.25% to 850,000 KRW.

Lineage 2M is maintaining higher-than-expected revenue. A global launch including Taiwan and Japan is anticipated as early as the end of the third quarter.

Jae-min Ahn, a researcher at NH Investment & Securities, stated, “In 2021, new releases such as Blade & Soul 2 and Aion 2 are scheduled,” adding, “They have secured multiple hit titles on mobile as well, entering a virtuous cycle where intellectual property (IP) expands and performance grows.”

Although there is a possibility of economic slowdown due to the novel coronavirus (COVID-19), people’s reduced outdoor activities are expected to increase game playtime. As the gaming industry is expected to benefit relatively, gaming stocks are anticipated to act as defensive stocks amid uncertain conditions.

Researcher Ahn explained, “Lineage 2M is not only recording stable revenue but also various indicators including user traffic are continuously rising, so high revenue is expected,” and added, “Concerns and negative views that appeared during the early stages of the game’s release have disappeared, indicating it has entered a stable phase.”

Next month, Lineage 2M is scheduled for a large-scale update marking its 100th day since launch, so the first quarter revenue of Lineage 2M is expected to be similar to that of the fourth quarter.

Researcher Ahn said, “The large-scale update in March will have the effect of gathering users in one place through server migration,” and explained, “After the update, as early as the second quarter, the introduction of siege warfare will further increase revenue once more.”